It's been said in the past that 1Spatial (SPA:AIM) was too early to the Big Data space. It struggled simply because many customers and potential clients assumed the theme was for the future, not the present. But this seems to be changing and today's confirmation of in-line results for the year to January 2014 underscores the rapid growth potentially capable by this £44 million business.

Today's announcement was relatively short, but sweet too. This line is encouraging: 'The Company produced a solid performance over the year and confirms that adjusted EBITDA (earnings before interest, tax, depreciation and amortisation) and overall results for the year will be in line with market expectations.'

Yet this bit is more important for the future: 'The Company enters the new financial year with a strong order back-log in excess of £7 million and a significant pipeline of opportunities.' Investors certainly like the cut of 1Spatial's jib, the shares jumping 8% to 6.75p. This, however, remains way down on the 10.5p levels seen at the start of the year, the shares slumping as part of a wider technology sell-off.

1SPATIAL - Comparison Line Chart (Rebased to first)

To re-cap, 1Spatial’s software is used to create, manage, analyse and display geospatial data. Customerso includes Unilever (ULVR), Unisys, US Census, Ordnance Survey GB, the Brazilian Army, and Ordnance Survey Ireland. Tapping investors for £18 million last year to buy a 75% stake in Star-Apic, a Belgium-based provider of Geographic Information Systems software and solutions specialising in land and infrastructure management, it significantly bolster 1Spatial's scope and scale, with sales and support teams bolstered in new Middle East offices. It also helps ongoing R&D and provides the firepower for more acquisitions down the line. It's worth noting that the business now owns all of Star-Apic after buying the last 10% slug of the company in January this year.

Interestingly, 1Spatial is not burning cash as fast as it might, or was expected to. With £11.1 million on its books, or 25% of its market value, that's more than the £10.8 million analysts at N+1 Singer anticipated at this stage. And that's after the spending £600,000 for that last Star-Apic stake not expected by the City, equating to nearly £1 million cash better off.

Singer forecasts revenue of £18.6 million for the year to January, from which investors can expected rough £1.1 million of adjusted EBITDA. For the financial year to January 2015 the company is forecast to produce £24.2 million revenue and £2.8 million EBITDA.


Issue Date: 25 Apr 2014