Cerillion plc (LON:CER) is the topic of conversation with Ciaran Donnelly Equity Research at Liberum, following the company’s published interim results for the six months ended 31 March 2023. We asked:
Q1. What stood out in the highlights?
Cerillion has delivered record KPIs in H1. Revenue grew 27% and Adj. EBITDA grew 38%. Adj. EBITDA margin has increased to 48.9% (from 44.9%) benefitting from a higher mix of license revenue as well as an FX tailwind in the period.
Q2. Can you give us more details on the new and back order book?
Cerillion’s pipeline is at a record £212m, +23% yoy. Back order book increased 8% and total new orders grew 40%.
Q3. What are your thoughts on the outlook for the company and new customer pipeline?
Management commented that the business remains well positioned to deliver the FY targets. Current consensus is for revenue of £38.1m and adj. EBITDA of £15.9m. The H1 performance suggest there is upside risk to FY23E consensus forecasts.
Q4. How do you see the company in terms of fair value?
The shares are trading on 30.5x CY23E P/E. Cerillion is trading at a premium relative to the peers. Cerillion is forecast to deliver higher growth relative to peers and at structurally higher margins.
Cerillion plc (LON CER) is a leading provider of billing, charging and customer management systems with more than 20 years’ experience delivering solutions across a broad range of industries including the telecommunications, finance, utilities and transportation sectors.
