accesso Technology’s first half cash performance impresses broker

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accesso Technology PLC’s (LON:ACSO) put in a resilient performance especially on the cash front in the first half of the year, according to broker Peel Hunt.

Revenue in the six months to June was $24.6mln, which was well ahead of the broker’s US$17.7mln estimate.

But it was the cash performance that impressed the broker.

accesso’s ‘steadfast focus on reducing monthly costs and stronger gross margins due to product mix ‘meant net cash ended on US$30.8mln (US$56mln gross), it said.

Stripping out the $46mln raised in May, net debt would have been $15.2mln or in line with the first half of last year, added the broker.

“This is extraordinary and is despite Covid-19’s impact on revenues, refunds it processed due to closures, and the fact that June is a high point from a net debt perspective.”

The broker added: “accesso has not needed to touch a penny of the money it raised in May, it has cut costs to become a more efficient machine, and its ability to navigate this climate gives us confidence for it to do even better when the world exits crisis mode.”

The broker said it will likely trim its loss estimate for this year to US$19mln and with a streamlined structure, led by refreshed senior management, a new-found focus on costs, and $56mln gross cash, accesso is well-positioned for a recovery.

Earlier, accesso had said revenue in the half-year to end June 2020 was US$24.6mln (US$50.7mln) as the company faced enforced venue closures from March onwards, though the outcome was ahead of its earlier expectations, the AIM-listed company said.

Going forward, accesso noted that nearly 80% of passport and 60% of LoQueue customer venues had reopened, while it has won several new contracts in the ski sector ahead of the winter season.

“Assuming market conditions do not deteriorate, we expect revenue for the full year 2020 to be not less than $48mln,” the group said in its half-year statement.

Shares rose 10% to 312.5p against Peel Hunt’s target price of 389p.

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