02 March 2022
By Maynard Paton
Results summary for System1 (SYS1):
- An acceptable H1 performance, albeit with profit lower than I had anticipated due to greater costs associated with the transition to Data services.
- Data services continue to advance, representing 36% of total revenue for H1 and reaching 43% for the subsequent Q3.
- UK revenue jumping 33% in part through an influx of new Data clients suggests the partnership with ITV is working.
- A Q4 sales warning relating to old-style Consultancy activities emphasised management’s upbeat ambitions are susceptible to mishaps.
- Net cash now represents 25% of the market cap, with long-term multi-bagger upside still obtainable if LTIP revenue targets are met and healthy ‘platform’ margins are delivered. I continue to hold.