engage:BDR bucks market trend: trades higher on strong revenue and earnings
Shares in engage:BDR (ASX:EN1) opened 10.5% higher on Tuesday morning, and they have now gained more than 30% in the last two weeks.
The company has particularly come under the spotlight since last Friday when it released an impressive full-year result for the 12 months to December 31, 2019.
Today management has provided a trading update and commentary regarding the group’s financial performance in February with a comparative analysis demonstrating significant improvements against the previous corresponding period.
While these figures are subject to audit they make for impressive reading.
February 2020 revenue of approximately $1.7 million was 322% ahead of the previous corresponding period.
The company is also demonstrating strong growth on a month-on-month basis with February revenues ahead of the $1.55 million generated in January.
The increase in income has been accompanied by strong margin improvement with gross profit margins for February standing at 41% compared with 36% in January.
EBITDA positive in February
From a profitability perspective, it was encouraging to note that February was EBITDA positive.
This is the best measure of earnings for a company such as EN1 as it excludes non-cash items and accurately reflects the company’s operational performance.
Management took the opportunity to note that the advertising industry traditionally generates between 65% and 70% of its revenues in the second half year, and this was case in 2019.
With similar revenue seasonality anticipated in 2020, it would appear that the company is poised to deliver a strong full year result.