Shares in the company rallied nearly 6% to 390.2p after saying that adjusted revenue increased by a solid 9% to $218.3m, after stripping out discontinued and sold-off parts of the business. The headline equivalent for the three months to 30 September was 7.3% growth.
Billings growth was similar while adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) rallied 8.7% to $121.9m. Guidance was reaffirmed at high single-digit revenue growth (for continuing operations) and broadly flat adjusted EBITDA margins.
‘We continue to successfully execute our growth strategy, underpinned by our platform distribution model and our global installed base of more than 435m users,’ said Ondrej Vlcek, chief executive of Avast.
Czech Republic-based Avast is one of the world’s biggest cyber security providers to consumers, with more than 435m people worldwide using its Avast or AVG firewall, anti-hacking, malware and anti-virus tool kits.
DESKTOPS STILL KEY GROWTH DRIVER
This looks very much like a continuation of the company’s ongoing strong momentum, which analysts suspect is driven primarily by its core consumer desktop products. Mobile still appears to be a relatively small work in progress.
About 70% of 2018’s $811.5m adjusted revenue came from desktop users.
‘The strong momentum helps reaffirm a successful IPO story so far, especially amongst the doom and gloom of the London markets as of late,’ said Megabuyte analyst Indraneel Arampatta.
Avast had its stock priced at 250p per share when it joined the London market in May 2018, giving the company a £2.38bn valuation, and making it one of London’s largest technology company flotations in recent years. Since then the share price has rallied 56%.
Avast is a current Shares Great Idea from May 2019, when we flagged the opportunity at 298.8p.