TXT (MI:TXTS) reported year-on-year revenue and EBITDA growth in Q118, with a particular boost to software licence sales. The change in the largest shareholder has prompted changes to the board, and is likely to mark the start of a series of acquisitions to accelerate the growth of the TXT Next business.
Q118 results: Making good progress
TXT reported 4.9% year-on-year revenue growth and 6.4% EBITDA growth in Q118. The EBITDA margin increased to 12.6% from 12.4% a year ago. With the adoption of IFRS 16 from the start of 2018, higher depreciation has resulted in a 14.9% decline in normalised EBIT. The company closed the quarter with net cash of €87.9m. We have revised our forecasts to reflect higher R&D and commercial costs in Q1, as well as higher than forecast gross margins. This results in a 10.2% increase in our FY18 normalised EPS forecast, and a 5.6% cut to our FY19 forecast.
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