1Spatial* - Positive Trading Update; Re-iterate Recommendation of buy


Key Data

EPIC
SPA

Share Price
40p

Spread
35p - 45p

Total no of Shares
21.19 million

Market Cap
8.5 million

12 Month Range
37p - 165p

Market
AIM

Website
www.1spatial.com

Sector
Software & Computer Services

Contact
Nic Snape
Chief Executive
01223 420414

1Spatial, an industry leader for the provision of solutions management tools for business critical location data, has this morning released an upbeat trading update that reaffirmed our expectations for full year numbers. Interim results for the 9-months trading period ended 31 December 2010 will be released on 22 March 2011.

1Spatial is a well-managed, acquisitive business that has been consistently profitable since its 2003 MBO. The company returned to the equity market last October through the reverse takeover of the AIM listed shell, IQ Holdings plc. The listing enables 1Spatial to participate more actively in the consolidation of the fast growing geospatial market while strengthening its technical capabilities and extending geographic boundaries. The geospatial market between 2006 and 2010 grew at 38.4% CAGR to US$2.65 billion.

The company's trading update confirmed that spending by UK Government departments and other Agencies had been constrained from the election and until the completion of the Coalition's 'Comprehensive Spending Review' and Pre-Budget Report, which suggests the company may not have been fully recovering overheads for several months. However, since then, business has returned to more normal levels of activity and ' ... revenue for the period is ahead of management's expectations and 1Spatial remains firmly on track in the run up to the year end. Over the last three months the Company has secured a number of contracts in the National Mapping Agency arena and the public and private sectors....' Indeed, on 12th January 2011, Ordnance Survey awarded the company a 'ground-breaking' Framework Agreement, which is testament to both its market leading software and service offering as well as its strategy. Consequently, we are not changing our existing annualised forecasts (before exceptional items) for the 15-month trading period ending 30th June 2011.

1Spatial has a strong management team with a good track record and started its public or quoted life with net cash on the balance sheet. The company remains fundamentally cash generative and on an earnings growth track despite the difficult UK and global economies. In recognition of the persistently but well documented difficult macro-economic environment, we have maintained our forecasts but trimmed our 2012 EV/EBITDA valuation multiple from 10 to 7.5 times, which is broadly equivalent to a 50% discount to the FTSE Technology P/E multiple of 24.9 times and indicates target price of 100p. With the shares trading at 40p and with a target price of 100p, we re-iterate our recommendation of Buy.

Forecast Table


Year to 30 June
Sales
(000)
Pre-tax Profit
(000)
Earnings per share (p)
Price Earnings Ratio (x)
Dividend (p)
Yield (%)

2009A
8,403
303
1.27
31.4
0.0
0.0

2010A
8,008
73
0.93
43.0
0.0
0.0

2011E1
8,508
675
5.44
7.4
0.0
0.0

2012E
9,785
1,510
8.25
4.8
0.0
0.0


Source: Growth Equities & Company Research

Notes:

1 Annual results for the 15-month trading period ending 30 June 2011 will be released at the year end.

*1Spatial is a corporate client of Rivington Street Holdings the ultimate owner of GE&CR. Rivington Street Corporate Finance and Bishopsgate Communications, both subsidiaries of Rivington Street Holdings are advisers to 1Spatial. The SF t1ps Growth Fund which is managed by a Rivington Street Holdings subsidiary owns shares in 1Spatial as does Rivington Street Holdings CEO Tom Winnifrith.

1Spatial to present at the London Innovators and Investors Forum

It is our pleasure to invite you to attend the forthcoming Innovators & Investors Forum on the 29th January 2013 at the Business Design Centre, London. This will be an exclusive invitation only event organised by Shares Magazine and Cenkos Securities.

As an active private investor, we are sure you would appreciate this unique opportunity to receive privileged access to 30 diverse, forward thinking and energetic technology companies at a single event.

Many of the exhibiting companies are currently involved in some very exciting projects in an effort to drive future growth, and development within their industries.

The event will be supported with an extensive conference program, including keynote speakers and company presentations.

We sincerely hope you are able to attend and that you find the experience both profitable and enlightening. Companies represented include:

1Spatial
Avanti Communications
Bango
Bond International Software Group
Brady
CML Microsystems
Corac
Cyan Holdings
eg Solutions
Energetix Group
eServGlobal
Forbidden Technologies
Fusion IP
Globo
incadea
InternetQ
IQE
KBC Advanced Technologies
Netcall
Optimal Payments
Plastics Capital
Probability
Quindell Portfolio
StatPro Group
WANdisco


Event time: 12.30pm to 5.30pm

Complimentary refreshments and luncheon provided

To register for this event please click here


CONFERENCE AGENDA AS AT 09.01.13
(To be updated once presentation speakers are confirmed)

12:30 Registration & Lunch

14:00 Keynote speaker - Richard Penny, Senior Fund Manager - Legal and General

14:15 Shares Magazine presentation - Russ Mould, Editorial Director

14:30 Company presentation - David Richards, President & CEO - WANdisco

14:45 Company presentation - Henrik Bang, CEO - Netcall

15:00 Company presentation - Marcus Hanke, CEO - 1Spatial

15:15 Company presentation - tbc

15:30 Coffee Break

16:00 Company presentation - Stephen Blundell, CFO - eServGlobal

16:15 Company presentation - David Baynes, CEO - Fusion IP

16:30 Company presentation - Stephen Streater, CEO - Forbidden Technologies

16:45 Company presentation - Charles Cohen, CEO - Probability

17:00 Company presentation - Simon Smith, Non-Executive Director - Cyan Holdings

17:15 Close

This agenda is subject to change and alterations

For further information, please visit our events page