Today Smart Parking Ltd (ASX: SPZ) released its half-year results to the market for the period ending 31 December 2018, posting a net loss of $0.6 million which was down from a $2.2 million profit in the prior period.
Smart Parking is involved in the design, development and management of parking technology with the majority of its revenue coming from UK operations.
Key Results
Smart Parking reported:
- Revenue down 14% to $14.1 million
- EBITDA of $0.5 million (prior period $3.9 million)
- Net loss after tax of $0.6 million (prior period profit $2.2 million)
- Operating cash flow from operations of $1.4 million (prior period $3.1 million).
Cashed Up?
On its balance sheet, Smart Parking has just over $11.4 million of cash and cash equivalents. However, part of this cash includes amounts collected on behalf of customers amounting to $708,701. The corresponding liability of $708,701 is recorded in other payables. As the amount can be material, investors should be mindful to check how much cash it holds on behalf of customers. Despite this, the company has a net cash position of just under $13 million.
Management Commentary
“Whilst the result is below the prior comparative period, SPZ has worked hard to lay a solid foundation for future growth,” Smart Parking CEO Paul Gillespie said.
“Our financial performance reflects the investments we have made in people, processes and systems to capitalise on our significant market growth opportunities. We have the world leading car park management technology and provide world-class managed services,” Mr Gillerspie added. “The growth in sites and sensor installations, and our strong order book and pipeline validate our compelling customer value proposition. With our strong balance sheet, strengthened UK management team and growth investments in sales and operations in place, we have completed the stabilisation phase and are back into growth mode”.
Rask Perspective
While the results look disappointing at face value, Smart Parking has a valuable product, positive cash flows, a strong balance and a growing customer base – I can see why this would occupy a small position in an investor’s portfolio.
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