- Multi-year deal worth $19 million over three years
- CEO hails Liberty automated engagement platform
- Canaccord ups 2023 forecasts by 17% to 23%
Analysts have hiked profits and revenue forecasts for call centre technology supplier Netcall (NET:AIM) after the Bedford-based company hooked a multi-year contract with an S&P 500 international financial services big fish to use its Liberty automated engagement platform.
The deal will see Netcall earn $19 million of revenue for the initial three-year cloud subscription on rough par margins that the UK company currently earns.
Last year (to 30 June 2021), Netcall recorded 90% gross margins. However, there is considerable cost involved in delivery, which eats deeply into operating profits. Adjusted operating margins last year were just 12.5%.
That did not dampen the enthusiasm at Canaccord Genuity. ‘We upgrade full year 2023 estimated revenue by £3.2 million and adjusted EBITDA/EBIT/EPS by circa 17% to 23%,’ the analyst said.
Those abbreviations stand for earnings before interest, tax, depreciation and amortisation; earnings before interest and tax (a proxy for operating profit), and earnings per share.
SECOND FORECAST HIKE THIS YEAR
Having upped estimates earlier this year, ‘we now increase full year 2023 again following today’s contract announcement, which is the largest contract ever won by Netcall and materially increases exposure in the financial services vertical,’ said Canaccord.
‘This landmark contract demonstrates the quality of the Liberty platform and its ability to support the world’s largest companies in their digital transformation efforts,’ said Henrik Bang, Netcall’s chief executive. ‘Having successfully deployed initial applications in North America and Europe, the customer will now use Liberty low-code and RPA across its global operations,’ confirmed Bang.
Netcall shares have been steady if soggy so far this year, drifting around 6% since the start of 2022 to last night’s 65p close. But the stock jumped in morning trade on Friday, rallying 22.5% to 79.6p. Netcall’s all-time high was 88p hit in September 2021.
