Dona Ferentes
A little bit OC⚡DC
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MP1 - Megaport Limited
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Holy crap, who did you had dinner with?
are you an "insider"?
I hope you did buy some
Dona Ferentes
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not this time...
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That would have been a nice start of the week...
Dona Ferentes
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More L'Etranger ...
I looked at the results and thought they were ho-hum..
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but I don't run a spreadsheet and take a view like some big players, short or long, seem to.
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holding on to the gains, so far...
Dona Ferentes
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Megaport will come out with Half Yearly on Tuesday. It will be interesting if the company can sustain its recent performance. Has been holding on well, since the upgrade ...
YTD
YTD
Last edited:
Dona Ferentes
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$13.80 .. lots of ra-ra :
Conclusions and Outlook
1H FY24 saw Megaport achieve four consecutive quarters of positive net operating cash flows, culminating in the Company being released by ASX from its quarterly activity and cash flow reporting obligations. The Company’s first half showcases the tremendous turnaround in financial performance, resulting from robust organic revenue growth, a substantial cost-out program, and improved operational efficiencies. This achievement demonstrates Megaport’s commitment to delivering profitable, efficient growth.
Michael Reid, Megaport CEO, said, “Megaport delivered an incredible $30.1M of EBITDA for the half, up 785% on the prior half, an amazing result and indicative of the outstanding financial turnaround.
“$12.5M in Net Cash Flow represents a massive $40.8M improvement from the $28.3M net cash outflow we reported for the half year at this time last year. A phenomenal result that has enabled us to make investments in the go-to-market engine while maintaining our robust financial position.
“With our finances in great shape and a go-to-market engine poised to fire, we’re happy to report that FY24 revenue and EBITDA guidance is being restated at $190-$195M and $51-$57M, respectively. And our net cash flow remains strong after already lowering our ďlcapex guidance to $20-$22M in January 2024.
“I am extremely proud of how dramatically the Company has turned around its financial position... A strong financial foundation has been laid, and I look forward to doubling down on our efforts in the second half as we continue to deliver profitable, efficient growth.”
Conclusions and Outlook
1H FY24 saw Megaport achieve four consecutive quarters of positive net operating cash flows, culminating in the Company being released by ASX from its quarterly activity and cash flow reporting obligations. The Company’s first half showcases the tremendous turnaround in financial performance, resulting from robust organic revenue growth, a substantial cost-out program, and improved operational efficiencies. This achievement demonstrates Megaport’s commitment to delivering profitable, efficient growth.
Michael Reid, Megaport CEO, said, “Megaport delivered an incredible $30.1M of EBITDA for the half, up 785% on the prior half, an amazing result and indicative of the outstanding financial turnaround.
“$12.5M in Net Cash Flow represents a massive $40.8M improvement from the $28.3M net cash outflow we reported for the half year at this time last year. A phenomenal result that has enabled us to make investments in the go-to-market engine while maintaining our robust financial position.
“With our finances in great shape and a go-to-market engine poised to fire, we’re happy to report that FY24 revenue and EBITDA guidance is being restated at $190-$195M and $51-$57M, respectively. And our net cash flow remains strong after already lowering our ďlcapex guidance to $20-$22M in January 2024.
“I am extremely proud of how dramatically the Company has turned around its financial position... A strong financial foundation has been laid, and I look forward to doubling down on our efforts in the second half as we continue to deliver profitable, efficient growth.”
Dona Ferentes
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as high as $14.44
mentioned in dispatches in the weekend press as a takeover target, with heavy hitters selliing the M&A story
mentioned in dispatches in the weekend press as a takeover target, with heavy hitters selliing the M&A story
Dona Ferentes
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the biggest conviction story around
.. ... since the Q was announced late Jan, there's been very little pullback
.. ... since the Q was announced late Jan, there's been very little pullback
growthgauge
https://growthgauge.com.au
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If you are interested in Megaport : I have put together my thoughts at https://growthgauge.substack.com/p/riding-the-digital-wave-how-megaport - I would welcome your thoughts/feedback. I am open to any kind of feedback.
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You are going to have to stop linking to your substack, as it is against forum rules to continually link to your own content on other websites.
What you are allowed to do is to have a link to your substack in your signature. You are also welcome to reproduce the content on your substack here at ASF, or perhaps part of it if you would prefer not to reproduce it all. However, I can't allow you to keep posting links to your substack in forum threads, as it is not the way we do things around here.
growthgauge
https://growthgauge.com.au
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Ok understood. Will keep that in mind. My content is very hard to put it in this forum format as it is very long. But yeah i will just keep as my signature. Thanks and sorry.
growthgauge
https://growthgauge.com.au
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i put signatures is it ok?
Dona Ferentes
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you can use the "quote" function on top bar to compress content..
it will fold it up ... use a few breaks at appropriate times
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.expands out to give 2 lines BOLD, Italic, etc. the second 3 dots expands to show more editing options
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Dona Ferentes
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update .. not upgrade. down a dollar to $13.25
....as a result of continued improvement in the Company’s operating and financial performance, the Company upgrades FY24 EBITDA to be in the range of $56M to $58M, an increase on the previous FY24 guidance of $51M to $57M. This reflects an increase of 177% to 187% compared to FY23 Normalised EBITDA of $20.2M.
Megaport confirms it expects FY24 Revenue to be in the range of $190M to $195M, an increase of 24% to 27% on FY23 Revenue of $153.1M. FY24 capital expenditure guidance of$20M to $22M is also confirmed.
This guidance is provided after taking into account the planned investment in go-to-market capabilities, product development, marketing, advertising, travel, entertainment, professional fees and planned capital expenditure, and excludes any future strategic initiatives the Company may decide to undertake.
....as a result of continued improvement in the Company’s operating and financial performance, the Company upgrades FY24 EBITDA to be in the range of $56M to $58M, an increase on the previous FY24 guidance of $51M to $57M. This reflects an increase of 177% to 187% compared to FY23 Normalised EBITDA of $20.2M.
Megaport confirms it expects FY24 Revenue to be in the range of $190M to $195M, an increase of 24% to 27% on FY23 Revenue of $153.1M. FY24 capital expenditure guidance of$20M to $22M is also confirmed.
This guidance is provided after taking into account the planned investment in go-to-market capabilities, product development, marketing, advertising, travel, entertainment, professional fees and planned capital expenditure, and excludes any future strategic initiatives the Company may decide to undertake.
growthgauge
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Steady performance. Thesis intact. Looking forward to FY24 result in August.
Dona Ferentes
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...Full Year Financial Report due to be released to the ASX pre-market open on Thursday, 22 August 2024.
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went below $10 this morning. When I sold and saw it go higher, to $15, I was miffed. But now feel good about that decision.
I know it's a bias, but I'd rather sell into strength than follow it down , with remorse
Dona Ferentes
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$11.79, likely to open up a bit
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Total revenue for FY24 was $195.3M, up $42.2M or 28% compared to FY23. ARR grew to $203.9M in June 2024, up $25.3M or 14% compared to June 2023. Gross profit in FY24 was $136.8M, up $32.9M or 32% on FY23.
Megaport delivered a record EBITDA of $57.1M, in line with guidance, and up $36.9M from $20.2Min FY23. These improvements in EBITDA reflect the full year impact of the pivot to profitable, efficient growth in FY24, delivering a robust financial turnaround, while also reinvesting for future growth.
Megaport achieved its first ever net profit after tax for the year of $9.6M, up $19.4M on FY23's net loss.
The Net Cash Flow of $28.0M for the FY24 full year was a $62.5M improvement compared to FY23. Net Cash as at 30 June 2024 was $61.2M, up 84% compared to 30 June 2023.
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Total revenue for FY24 was $195.3M, up $42.2M or 28% compared to FY23. ARR grew to $203.9M in June 2024, up $25.3M or 14% compared to June 2023. Gross profit in FY24 was $136.8M, up $32.9M or 32% on FY23.
Megaport delivered a record EBITDA of $57.1M, in line with guidance, and up $36.9M from $20.2Min FY23. These improvements in EBITDA reflect the full year impact of the pivot to profitable, efficient growth in FY24, delivering a robust financial turnaround, while also reinvesting for future growth.
Megaport achieved its first ever net profit after tax for the year of $9.6M, up $19.4M on FY23's net loss.
The Net Cash Flow of $28.0M for the FY24 full year was a $62.5M improvement compared to FY23. Net Cash as at 30 June 2024 was $61.2M, up 84% compared to 30 June 2023.
Dona Ferentes
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I'm going to open up a bit, and declare "what would I know !!"
... curiosity value only, I no longer hold.
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the market has spoken
Dona Ferentes
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factyy *
Datt Capital's Emanuel Datt
Another thing that stuck out to me was that it did not appear that they have captured any new large customers - and it's highlighted that Megaport is experiencing declining trends, in many ways. Ultimately, it looks pretty expensive compared to the rest of its peer group in the technology sector.
I think the EBITDA guidance of $57-65 million was very soft given the valuation of $1.5 billion, and that market cap is after the drop today, so it's trading at almost 30 times forward EBITDA, which is pretty rich for a business that doesn't look like it's growing very fast.
I think it's going to take a lot for the perception of the company to turn around, now that the slowdown in growth has been so pronounced. So, I think there is still material downside risk to the business.
Ultimately, with this particular company, I think it's all about customer acquisition. And that is clearly slowing down in terms of Megaport's ability to impressively grow the top line. They have a team of people focused on improving the bottom line, so the EBITDA margins seem to be improving somewhat, but you can only grow that so much - it's not infinite, and there are only so many costs that you can cut. I think investors can expect top-line growth to remain flat or just grow by a single-digit percentage from here.
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*wise after fact
Datt Capital's Emanuel Datt
In one sentence, what was the key takeaway from this result?
Underperformance on all metrics, slower growth than anticipated.Were there any surprises in this result that you think investors may have missed?
I was actually surprised by how slow the growth was achieved. The company reported low percentage growth across total services. Given that Megaport is valued as a high-growth company, and before the result, it was trading on about 7 times forward EV/sales - I think the market was anticipating a lot more growth than it delivered. That's why it's been hammered over 20% today.Another thing that stuck out to me was that it did not appear that they have captured any new large customers - and it's highlighted that Megaport is experiencing declining trends, in many ways. Ultimately, it looks pretty expensive compared to the rest of its peer group in the technology sector.
I think the EBITDA guidance of $57-65 million was very soft given the valuation of $1.5 billion, and that market cap is after the drop today, so it's trading at almost 30 times forward EBITDA, which is pretty rich for a business that doesn't look like it's growing very fast.
Would you buy, hold or sell MP1 off the back of this result?
Rating: SELLI think it's going to take a lot for the perception of the company to turn around, now that the slowdown in growth has been so pronounced. So, I think there is still material downside risk to the business.
Are there any risks investors should be aware of?
I think what is really standing out, from my observation of the technology space, is that there seem to be some headwinds in terms of companies' ability to raise prices. A lot more services are becoming more commonplace. AI is basically compressing technology companies' ability to monetise.Ultimately, with this particular company, I think it's all about customer acquisition. And that is clearly slowing down in terms of Megaport's ability to impressively grow the top line. They have a team of people focused on improving the bottom line, so the EBITDA margins seem to be improving somewhat, but you can only grow that so much - it's not infinite, and there are only so many costs that you can cut. I think investors can expect top-line growth to remain flat or just grow by a single-digit percentage from here.
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*wise after fact
