around 4p target16 Apr 2018 17:08
STARCOM (STAR.L)
SECTOR � TECHNOLOGY
RATING � CORP*
MARKET CAP � �6.7m
CURRENT PRICE � 2.6p#
TARGET PRICE � 3.7p
ANALYST � MIKE JEREMY
For the year to 31st December 2017 Starcom reported revenue of US$5.440m, +6.0% YoY, with hardware sales +9.8% YoY, and gross profit of US$ $2.080m, with gross margin stable at 38.2% (FY16, adjusted: 37.4%).
The adjusted EBITDA loss, excluding share options provision, was reduced from US$(781,000) in FY16 to US$(193,000). The reported net loss was also reduced from US$(1.945)m in FY16 to US$(1.350)m, inclusive of US$(204,000) arising from foreign exchange differences (2016: US$(59,000)).
At its 9th April AGM Starcom reported Q1 revenue of US$1.5m, ahead of the US$1.0m indicated at FY17 results, and $0.765m a year earlier. At the year-end, CEO Avi Hartmann had noted: "2017 proved to be a turning point in the history of Starcom, with significant progress being made both in the development of our technology and the acceptance of that technology by some major companies and organisations�.
The AGM Trading Update indicated that Q1 revenue and �positive sales enquiries� indicate that �revenues for the full year will comfortably exceed those of last year�. The company expects that FY18 EBITDA will be positive.
The latest AGM Trading Update continued to indicate the positive momentum highlighted at FY17 results.