From recovery to growth
Comptel's (HEL:CTL1V) P&L performance was robust in Q1 supported by the strong backlog entering the quarter. While the closure of some deals was pushed into Q2, news flow suggests that these are now closing, lending further support to full-year estimates. The company’s articulation of its growth strategy for 2015-17 and its revised branding signal both that this is a company moving from being technically focused to commercially driven and is moving out of a recovery phase into a growth one.
Steady start to the year
P&L performance was robust, largely reflecting the strong order intake in H2 last year. Revenues grew 16.3% y-o-y to €21.0m with operational gearing driving EBIT up by 55.7% to €1.5m. The twelve-month order backlog also remained robust at €55.8m up from €42.2m last year (€55.2m in Q4), although some larger deals did slip into Q2. Two FlowOne (fulfilment) deals have been announced since Q2 started, indicating that these are now starting to come through.
New strategy and branding
Since the arrival of Juhani Hintikka in January 11, Comptel has transitioned through phases of restructuring, stabilisation and recovery. A new strategy for 2015-2017 (and branding) unveiled at the Mobile World Congress in February set out how the company now plans to deliver profitable growth and margin expansion. The company is seeing good opportunities for both its Intelligent Data and its Service Orchestration products. In Intelligent Data the company’s Data Refinery products integrate data enrichment and analytics capability into the mediation offering, providing a potentially powerful mechanism to leverage the company’s extensive mediation customer base. In Service Orchestration, the company’s solutions are increasingly being considered as part of large OSS transformation products, enabled by product updates and the relationship with Tech Mahindra.
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