Kape Technologies Plc
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Description
Kape Technologies is a cybersecurity company focused on digital privacy and protection. In order to do this, Kape develops and distributes a variety of software products in the online security space, utilising its proprietary digital distribution technology to optimise its customer reach and create a superb user experience. The Company offers products which provide online security, privacy and optimal online experience. The acquisition of virtual private network provider Private Internet Access in December 2019 was a transformational and significantly earnings enhancing deal for the Group.
Company Presentations
Our view
The highly significant and transformational acquisition of PIA accelerated Kape's strategy and transported its quest to become a world leader in digital privacy to a new level. It is benefitting from a significantly enhanced pool of R&D talent with the addition of PIA’s market-leading development team.
Financial Summary
Year end: December ($m unless shown)
| 2018 | 2019 | 2020 | 2021 | 2022 | |
|---|---|---|---|---|---|
| Revenue | 52.1 | 66.1 | 120.8 | 135.9 | 146.8 |
| Adjusted EBITDA | 10.4 | 14.6 | 36.2 | 41.5 | 44.6 |
| Adjusted PBT | 8.2 | 10.6 | 30.9 | 36.4 | 40.2 |
| Adjusted Dil EPS (c) | 5.0 | 6.4 | 14.2 | 15.8 | 17.5 |
Profit & Loss
Year end: December ($m unless shown)
| 2018 | 2019 | 2020 | 2021 | 2022 | |
|---|---|---|---|---|---|
| Revenue | 52.1 | 66.1 | 120.8 | 135.9 | 146.8 |
| Adj EBITDA | 10.4 | 14.6 | 36.2 | 41.5 | 44.6 |
| Adj EBIT | 8.3 | 11.9 | 33.1 | 38.1 | 41.2 |
| Reported PBT | 3.3 | 2.8 | 12.9 | 18.1 | 21.6 |
| Fully adj PBT | 8.2 | 10.6 | 30.9 | 36.4 | 40.2 |
| NOPAT | 7.7 | 11.1 | 31.0 | 35.6 | 38.5 |
| Reported Dil EPS (c) | (0.3) | 1.3 | 19.4 | 8.0 | 9.5 |
| Fully adj Dil EPS (c) | 5.0 | 6.4 | 14.2 | 15.8 | 17.5 |
| Dividend per share (c) | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
Cash Flow & Balance Sheet
Year end: December ($m unless shown)
| 2018 | 2019 | 2020 | 2021 | 2022 | |
|---|---|---|---|---|---|
| Operating cash flow | 3.2 | (1.7) | 22.1 | 29.6 | 36.1 |
| Free Cash flow ($m) | (0.4) | (5.4) | 16.0 | 24.0 | 27.3 |
| FCF per share (c) | (0.2) | (3.6) | 7.9 | 11.2 | 12.7 |
| Acquisitions | (21.2) | (64.3) | (77.0) | (15.0) | 0.0 |
| Disposals | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| Shares issued | 0.0 | 0.0 | 115.0 | 0.0 | 0.0 |
| Net cash flow | (29.1) | (70.9) | 54.0 | 9.0 | 27.3 |
| Overdrafts / borrowings | 0.0 | (40.2) | (35.2) | (28.5) | (21.8) |
| Cash & equivalents | 40.4 | 8.2 | 57.2 | 59.5 | 80.2 |
| Net (Debt)/Cash | 40.4 | (32.0) | 22.0 | 31.0 | 58.4 |
Nav & Returns
Year end: December ($m unless shown)
| 2018 | 2019 | 2020 | 2021 | 2022 | |
|---|---|---|---|---|---|
| Net asset value | 73.0 | 155.0 | 299.4 | 316.5 | 337.0 |
| NAV/share (c) | 51.3 | 99.2 | 143.7 | 152.0 | 161.8 |
| Net Tangible Asset Value | 36.7 | (87.1) | 56.3 | 69.5 | 107.3 |
| NTAV/share (c) | 25.8 | (55.7) | 27.0 | 33.3 | 51.5 |
| Average equity | 76.2 | 114.0 | 227.2 | 308.0 | 326.8 |
| Post-tax ROE (%) | (0.7%) | 1.8% | 6.0% | 5.6% | 6.3% |
Metrics
Year end: December ($m unless shown)
| 2018 | 2019 | 2020 | 2021 | 2022 | |
|---|---|---|---|---|---|
| Revenue growth | 2.9% | 26.9% | 82.8% | 12.6% | 8.0% |
| Adj EBITDA growth | 28.3% | 40.3% | 148.7% | 14.5% | 7.6% |
| Adj EBIT growth | 24.1% | 43.5% | 178.2% | 15.0% | 8.1% |
| Adj PBT growth | 24.8% | 28.1% | 192.0% | 18.0% | 10.3% |
| Adj EPS growth | 33.5% | 28.8% | 121.4% | 11.7% | 10.5% |
| Dividend growth | (100.0%) | N/A | N/A | N/A | N/A |
| Adj EBIT margins | 15.9% | 18.0% | 27.4% | 28.0% | 28.0% |