Altium Share Price Up 5.86% With Impressive FY19 Results

Multinational computer software company Altium Limited [ASX:ALU] has seen $1.96 added to their share price within the first half hour of trading this morning.

The immediate 5.86% increase follows the release of their FY19 results after market closing yesterday.

Altium is boasting an ‘outstanding’ revenue increase of 23% across all business units and key regions, to sit at US$171.8 million.

The company also reached record profit margins with an NPAT (net profit after tax) of US$52.9 million — a 41% increase.

We saw a similar spike in February with the release of their half year results.

Since then, Altium have maintained relative stability, up 55% for the year to date.

But is there potential for Altium to continue these high growth phases?

An update full of highs

It seems Altium is ticking all the boxes when it comes to being a company that delivers on its profitability.

Aside from revenue, Altium’s high profitability is also reflected in their Earnings Per Share (EPS), which is up 41% for the year at 40.57 cents.

Operating cash flow is also up, rising 42% to reach $69.1 million.

The company’s chief financial officer, Joe Bedewi, noted how China took the top spot in revenue growth per region, with a 37% increase from last year.

Bedewi says this ‘is an endorsement that our investment In additional China based resources has paid off’.

Altium also announced a final dividend of 18 cents, which puts their full year dividend at 34 cents, compared to 27 cents for FY18.

Shareholders are no doubt happy with the 26% increase in dividend payment.

The final dividend will be recorded on 4 September, with payment on 25 September.

Where does Altium go from here?

Altium CEO, MR Aram Mirkazemi, says ‘what makes this performance most outstanding is that it has been achieved while Altium has been focused intensely on investing to accelerate future growth.

With these results and the growing momentum, I am fully confident that we should not only be able to achieve but surpass our 2020 target of US$200 million’.

Altium are hoping to reach 100,000 Altium Designer subscribers before 2025 to obtain market dominance.

This bleeds into their 2025 revenue goal of US$500 million — undoubtedly a large leap from where they sit today.

But with a current expectation of 50,000 subscribers as soon as 2020, these aspirational targets are looking more and more attainable.

Their four product platforms are ‘meeting the needs of every customer from a large enterprise to an aspiring start-up’, helping them hit all corners of the expanding technology sector.

In their long-term outlook, Altium claim that the ongoing improvement and enhancement of smart connected devices will be the main drive for growth in the business for the ‘foreseeable future’.

Frankly, a company wishing to tap into as many avenues of technology as possible, is one that looks set for more returns in this tech-driven world.

A good one to watch.

Regards,

Ryan Clarkson-Ledward,

For Money Morning

PS: One major leap of innovation in this growing tech sector is the emergence of AI and Automation technology. Check out this free report covering ‘The Most Exciting AI and Automation Stocks on the ASX’ to discover how you could get a slice of the tech pie that companies like Altium are chasing. Download now.

 


Ryan Clarkson-Ledward is one of Money Morning’s junior analysts. Ryan holds degrees in both communication and international business. He helps bring Money Morning readers the latest market updates, both locally and abroad. Ryan tackles all the issues investors need to know about that the mainstream media neglects. Ryan’s primary focus is assisting Sam Volkering with background research and insight for readers by dissecting the latest events affecting the world. Working closely with Sam, they explore the latest in small-cap and technology stocks as well as cryptocurrency opportunities. You can find Ryan’s contributing research, developments, and supporting information across several e-letters, including:


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