(Copenhagen, 13 August 2020) Napatech A/S (“Napatech”, OSE: NAPA) reported revenues of DKK 48.9 million in the second quarter of 2020 (39.6 million in the second quarter of 2019), an increase of 23%, and an EBITDA of DKK 11.8 million (1.1). The company considers the COVID-19 pandemic to represent a low risk to the overall business and has raised its guidance for 2020.
“Napatech delivered solid performance in the second quarter, with underlying growth, improved earnings and a significantly improved cash flow. Our customer growth has been strong during the year, despite ongoing global challenges from the COVID-19 pandemic, and we increase our guidance for the full year,” says Ray Smets, CEO of Napatech, and continues:
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“Our solutions attract the best-known companies globally; equipment manufacturers embedding our solutions as part of their product offering and end-user customers selecting us for data center projects that span multiple quarters. All of our customers choose Napatech’s solutions to accelerate their key business applications around network monitoring, application performance, improvements in network security, and better performing financial services applications. Our customers select Napatech because our solutions solve their urgent problems around application performance and acceleration and improve the efficiency of their networks and IT infrastructure.”
Napatech grew revenues by 23% in the second quarter of 2020, compared to the second quarter of 2019. The company’s reported revenues in the second quarter of 2020 were DKK 48.9 million (DKK 39.6 million in the second quarter of 2019) and the EBITDA was DKK 11.8 million (1.1). The net cash flow from operating activities ended at DKK 14.7 million in the quarter (7.1), contributing to a cash balance of DKK 69.9 million (59.9)
“The financial results are another proof-point for our new strategy, and we delivered the first profitable first half year since the company started trading on the Oslo Stock Exchange. All parameters are developing positively, with profitable growth, a high gross margin, solid cash generation and an improved outlook, despite the recent USD weakening” Smets adds.
Following the results in the first half of 2020 and the outlook for the reminder of the year, Napatech has updated the outlook for 2020:
- Revenue in the range of DKK 185-205 million (unchanged)
- Gross margin 70-72% (previous 68-72%)
- Staff expenses and other external costs in the range of DKK 120-125 million (previous DKK 125-135 million)
- DKK 13-18 million transferred to capitalized development costs (previous DKK 15-20 million)
- Depreciation and amortization in the range of DKK 20-25 million (unchanged)
With performance in the middle of the guided ranges, EBITDAC would be DKK 16.0 million and EBIT would be DKK 8.9 million (previous guidance DKK 6.5 million and DKK 1.5 million respectively).
“As we enter the second half of 2020, we believe our guidance raise is achievable, even in these dynamic times. We will diligently execute in this market to both capitalize on the benefits and minimize the negatives. We will focus on what we do best, bringing a world-class technology solution to the markets that need us now more than ever. We will do this with a focus on revenue growth, smart investments and an eye on profitability. We have a passionate goal to demonstrate our potential, with a good dose of pragmatism, so we can earn our investor’s trust. And we will take the right risks, when presented, to capitalize on our potential to win,” Smets concludes.
For more information, please see the attached report for the second quarter and first half of 2020.
Napatech will host a webcast presentation and a conference call of its
second quarter and first half 2020 report today at 09:00 (CET). The presentation will be given by Ray Smets (CEO) and Heine Thorsgaard (CFO).
The presentation will be delivered by webcast on:
https://napatech.eventcdn.net/2020h1
The presentation and link to the webcast will also be available on the Napatech Investor Information section.
Dial-in details for the conference call are:
DK: +45 78 72 32 51
NO: +47 23 96 36 88
UK: +44 3333 009 261
US: +1 833 526 8395
EBITDA and other alternative performance measures (APMs) are defined on page 3 in the attached report for the second quarter and first half of 2020.
For additional information, please contact:
Heine Thorsgaard, Chief Financial Officer
Phone: +45 4596 1500
E-mail: htg@napatech.com
Media inquiries:
Geir Bjørlo, Corporate Communications AS
Telephone: +47 915 40 000
E-mail: geir.bjorlo@corpcom.no
About Napatech
Napatech helps companies to reimagine their business by bringing Hyperscale computing benefits to IT organizations of every size. We enhance open and standard virtualized servers to boost innovation and release valuable computing resources that improve services and increase revenue. Our reconfigurable computing platform™ is based on a broad set of FPGA software for leading IT compute, network, and security applications that are supported on a wide array of FPGA hardware designs.
www.napatech.com
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