di seguito e in allegato inviamo il company research report relativo a CYBEROO a cura di Intermonte.
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Strong 1H22 paves way to unlocking full operating leverage potential
- Fast Cybersecurity sales growth drives 1H22 performance. Sales grew by +67% YoY to €5.8mn, more than matching the expected rapid expansion in 1H (Intermonte est. €5.7mn/+65%) and even coming 9% above the 2H21 level. This highlights the strength of CYB’s growth momentum in our view: as a reminder, the typical seasonality of the business concentrates most commercial development in 2H/4Q. Cyber-security was the main growth driver as expected, at €3.6mn/+192% YoY, driven by the strong commercial growth of the cyber security suite: c.100 new clients added with a growing average contract size. Managed Services remained almost flat at €2.1mn/-2% YoY. Value of production was €6.7mn, up +50% YoY (vs Intermonte est. €6.6mn/+48%) with capitalized R&D costs of €0.75mn, slightly below our estimate of €0.9mn.
- Positive trend in margins notwithstanding 1H seasonality. CYB reported positive margins across the board, clear progress from the negative EBIT and net income seen in 1H21. Despite the c.€1mn step-up in the fixed cost base compared to 2H21 (of which c. €0.6mn in additional staff costs), CYB’s 1H22 EBIT of €0.9mn was superior to the 2H21 level of €0.8mn. EBITDA excl. capitalized R&D costs was €1.2mn, a 20% margin on sales (vs €-0.5mn/€1.5mn in1H21/2H21), beating our €0.9mn/15% margin forecast. Net debt of €0.82mn was up from FY21 (€0.27mn) as solid, positive operating cash flow of €1.1mn was offset by CapEx (€1.3mn) and the share buyback program (€0.35mn).
- Growth to accelerate in 2H, resumption of expansion abroad. CYB targets growth accelerating in 2H22 relative to 1H. CYB indicated that its pipeline offered good visibility on achieving this growth trajectory as we now enter the high season (4Q is the busiest period for commercial activity). Price increases may further support this trend, enabled by: i) product innovation (launch of Cypeer Sonic, with the price tag up 20%); and ii) an increasing share of larger mid-sized companies in the client base (coincidental with higher pricing). Other indications for 2H included: i) staff costs to increase only slightly in 2H; ii) R&D spend and CapEx to remain broadly steady (from €0.75mn/€1.3mn in 1H respectively). CYB has also resumed its expansion activities in the DACH region, where it targets onboarding 3 to 5 partners during 2H, with a contribution to sales growth targeted from 2023 onwards.
- Growth profile confirmed, EPS slightly reduced on a higher tax rate. We confirm our growth forecasts though we re-balance our mix, enhancing Cybersecurity (growing client size in 2022, international expansion in 2023) and reducing Managed Services. The slight reduction in EPS (-4%) reflects the higher tax rate, as seen in 1H.
- BUY rating confirmed, TP €5.5 (from €5.2). 1H22 results again show the solid execution of CYB’s growth strategy, enhancing visibility on our FY22 forecasts. The combination of the expected growth acceleration in 2H with the steadier cost base may potentially (finally) unlock a healthy level of operating leverage, enabled by the scalability of CYB’s MDR offering and enhanced automation capabilities at SOC level. The change in our TP reflects: i) the roll-over of our multiples-based valuation to base our TP solely on the 2023 multiples which, for reasons of prudence, we reduce by c.- 10%, coherent with our approach across our cybersecurity coverage (€+0.5 p.s.); and ii) our slightly lower EPS estimates (€-0.2 p.s.)