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1Spatial has announced several enterprise contract wins across key geographies, with the group executing on its growth strategy through land and expand, strategic partnerships and investment in sales. Contract extensions with the California Department of Transportation (Caltrans) and a major European utility customer provide further validation of the core enterprise offering, while the new contract with ATKIS-1Gen for cloud-based solutions signifies growing market demand away from on-premise technology towards advanced, cloud-based services. This progress provides strong momentum to the end of FY24 and positions 1Spatial for operationally geared growth in FY25, supported by a maturing pipeline for its SaaS-based applications, 1Streetworks and NG911. Progress supports our forecasts, which show top-line growth and margin expansion.

1Spatial has announced several enterprise contract wins across key geographies, with the group executing on its growth strategy through land and expand, strategic partnerships and investment in sales. Contract extensions with the California Department of Transportation (Caltrans) and a major European utility customer provide further validation of the core enterprise offering, while the new contract with ATKIS-1Gen for cloud-based solutions signifies growing market demand away from on-premise technology towards advanced, cloud-based services. This progress provides strong momentum to the end of FY24 and positions 1Spatial for operationally geared growth in FY25, supported by a maturing pipeline for its SaaS-based applications, 1Streetworks and NG911. Progress supports our forecasts, which show top-line growth and margin expansion.

1Spatial - Enterprise growth through key contract wins

1Spatial’s H124 results show robust revenue growth and continued improvement in the revenue mix, with recurring revenue growing by 24%. Investment in sales resource, inflationary pressures and FX compressed margins, but a strong pipeline for both renewals and SaaS products could drive revenues and margins in H2 and beyond. In particular, the market opportunity for both 1Streetworks and NG9-1-1 has the potential to be transformative. We have upgraded our revenue forecast but leave earnings largely unchanged. Good conversion of the SaaS pipeline could justify further revisions, which may not be reflected in the current valuation.

1Spatial’s H124 results show robust revenue growth and continued improvement in the revenue mix, with recurring revenue growing by 24%. Investment in sales resource, inflationary pressures and FX compressed margins, but a strong pipeline for both renewals and SaaS products could drive revenues and margins in H2 and beyond. In particular, the market opportunity for both 1Streetworks and NG9-1-1 has the potential to be transformative. We have upgraded our revenue forecast but leave earnings largely unchanged. Good conversion of the SaaS pipeline could justify further revisions, which may not be reflected in the current valuation.

1Spatial - Improving mix, SaaS potential draws nearer

1Spatial’s AGM statement provides further support for our view that the company is establishing a good platform for scalable recurring revenue growth. 1Spatial has secured its first customer for its Next Generation 911 (NG 911) solution in the US and three customers for its SaaS 1Streetworks product (including an additional one since 19 June). The opportunity for both products is significant, in our view. Sales cycles continue to be somewhat protracted within the current macro-economic environment. However, with a strong order book, pipeline and feedback for new products, management remains confident it can deliver FY24e results in line with expectations. Our estimates are unchanged but further progress with the SaaS products would potentially make the recurring revenue growth and margin expansion opportunity more apparent.

1Spatial’s AGM statement provides further support for our view that the company is establishing a good platform for scalable recurring revenue growth. 1Spatial has secured its first customer for its Next Generation 911 (NG 911) solution in the US and three customers for its SaaS 1Streetworks product (including an additional one since 19 June). The opportunity for both products is significant, in our view. Sales cycles continue to be somewhat protracted within the current macro-economic environment. However, with a strong order book, pipeline and feedback for new products, management remains confident it can deliver FY24e results in line with expectations. Our estimates are unchanged but further progress with the SaaS products would potentially make the recurring revenue growth and margin expansion opportunity more apparent.

1Spatial - SaaS progress and pipeline support prospects

1Spatial has won its first two contracts for 1Streetworks, the company’s SaaS-based Traffic Management Plan Automation product. This is an important development for the company in that the potential addressable market for this product is large; management estimates around £250m for low speed roads in the UK alone and 1Spatial looks well positioned to gain a significant market share. 1Streetworks also runs on the company’s newly launched cloud-based platform, representing an important milestone in 1Spatial’s migration to a scalable, SaaS-based model. Both contracts are for a three-month term initially, with the intention to move to annual or multi-year contracts upon successful completion. We are not changing our estimates at this stage. Further deal flow for 1Streetworks (or other SaaS products), together with the continuation of these initial deals to longer engagements, could be the catalyst for stronger growth and margin expansion to become priced in.

1Spatial has won its first two contracts for 1Streetworks, the company’s SaaS-based Traffic Management Plan Automation product. This is an important development for the company in that the potential addressable market for this product is large; management estimates around £250m for low speed roads in the UK alone and 1Spatial looks well positioned to gain a significant market share. 1Streetworks also runs on the company’s newly launched cloud-based platform, representing an important milestone in 1Spatial’s migration to a scalable, SaaS-based model. Both contracts are for a three-month term initially, with the intention to move to annual or multi-year contracts upon successful completion. We are not changing our estimates at this stage. Further deal flow for 1Streetworks (or other SaaS products), together with the continuation of these initial deals to longer engagements, could be the catalyst for stronger growth and margin expansion to become priced in.

1Spatial - First wins for key SaaS product

1Spatial’s full year results confirm the solid progress made over the course of the year with revenue growing 11%, recurring revenues growing 21% and EBITDA margins expanding from 15.5% to 16.7%. With momentum continuing into this year, and a healthy order book and pipeline, the company looks well set for 2024. Progress in its key strategic growth pillars – traffic management, US expansion and smart partnerships – looks promising and could accelerate scalable high-margin recurring revenue growth. Investment in key sales hires suppresses our profitability estimates for FY24, but we expect this to start delivering returns in the form of faster growth and margin expansion from FY25.

1Spatial’s full year results confirm the solid progress made over the course of the year with revenue growing 11%, recurring revenues growing 21% and EBITDA margins expanding from 15.5% to 16.7%. With momentum continuing into this year, and a healthy order book and pipeline, the company looks well set for 2024. Progress in its key strategic growth pillars – traffic management, US expansion and smart partnerships – looks promising and could accelerate scalable high-margin recurring revenue growth. Investment in key sales hires suppresses our profitability estimates for FY24, but we expect this to start delivering returns in the form of faster growth and margin expansion from FY25.

1Spatial - New SaaS apps to drive high-margin growth

United Kingdom

D4t4 Solutions Plc engages in the distribution, design, installation, and support of computer hardware and software systems in the United Kingdom. The company focuses on data solutions for its clients to provide end-to-end management of the entire data lifecycle, from its initial creation through the manipulation, analysis and management of the data, and eventual retirement into industry-compliant archives. It operates through three segments: License Sales, Project Work, and Recurring Revenues. The company offers data collection solutions, including digital data and document capture solutions; and data management solutions, such as cloud, secure data, application, content, and document management, as well as data storage and information archiving solutions. It also provides data analysis solutions comprising data insight, customer intelligence, integrated marketing management, data visualization, marketing automation, and search-driven analytics; and data solutions, including analytics-as-a-service, software-as-a-service, fraud solutions, platform modernization, migration and upgrades, and Web and mobile applications. The company was formerly known as IS Solutions plc and changed its name to D4t4 Solutions Plc in July 2016. D4t4 Solutions Plc was founded in 1985 and is headquartered in Sunbury-on-Thames, United Kingdom.

Eckoh plc provides secure payment products and customer service solutions for customer contact centers in the United Kingdom, the United States, and internationally. It provides HALOH, a suite of secure payments products that address concerns around the receipt, transmission, and storage of sensitive card information, insider and external fraud, and payment card industry data security standards compliance. The company?s HALOH product suite includes CallGuard solutions that can be deployed on the customer?s site, midcall, or hosted in the cloud, which allow contact center agents to take customer telephone payments without being exposed to card details; DataGuard, a hosted solution for e-commerce payments that prevents card data from entering organization and networks, as well as secures Web/mobile payments and batch files transfers; and EckohPAY, which enables customers to make automated secure self-service payments through phone, Web, or mobile devices. Eckoh plc was incorporated in 1997 and is headquartered in Hemel Hempstead, the United Kingdom.

Watchstone Group Plc provides technology and other services to the insurance, automotive, and healthcare industries in the United Kingdom, Canada, the United States, and internationally. It operates through Hubio, Ingenie, Healthcare Services, and Other segments. The company offers solutions to organizations in the insurance and automotive sectors to reduce claims, build customer engagement, and enable usage-based personalization. It also owns and operates physical rehabilitation clinics; and provides software platform, and call center and customer services. In addition, the company operates as an insurance broker; and offers feedback and advice for young drivers to improve their driving skills and stay safe. Further, it provides energy services, including procurement, energy audit, monitoring and targeting, and data sampling; and sells life, critical illness, and income protection insurance policies to customers and businesses, as well as operates QuoteSupermarket.com that enable customers to find the best quotes from a range of insurance providers. The company was formerly known as Quindell Plc and changed its name to Watchstone Group Plc in November 2015. Watchstone Group Plc was founded in 2000 and is based in Fareham, the United Kingdom.

Redcentric plc provides IT managed services in the United Kingdom. The company offers applications consulting, including database readiness, database and data optimization, and risk and compliance management services; managed database and application services; and on-premise services, such as application acceleration, as well as building resilient data management and analytics infrastructure services. It also provides collaboration services comprising IP telephony, SIP trunk, unified communications, video conferencing, calls and lines, and inbound services; and infrastructure services consisting of disaster recovery as a service, hosting and collocation, data management, infrastructure as a service, software as a service, hosted desktop, server load balancing, managed exchange, and virtualization services. In addition, the company offers network services, including multiprotocol label switching, metro network, business Internet access, connectivity, high capacity, Ethernet fabric, LAN and WAN, VPN, N3 network access, wireless network, secure remote access, and network monitoring services. Further, it provides security services comprising encryption, firewall, and network security; and mobile services consisting of mobile device, data, minutes, device management, device recycling, and messaging services. Additionally, the company operates and manages data centers. Redcentric plc was founded in 1997 and is headquartered in Harrogate, the United Kingdom.

Quartix Holdings plc designs, develops, and markets vehicle tracking devices; and provides related data services to the fleet and insurance sectors in the United Kingdom, France, the Republic of Ireland, and the United States. The company offers an integrated tracking and telematics data analysis solution for fleets of commercial vehicles and pay as you drive motor insurance providers. Its proprietary software system provides business critical reporting and analysis of vehicle and driver data, including timesheets and other customer key performance indicators to customers through any Internet-enabled devices. The company was founded in 2001 and is based in Cambridge, the United Kingdom.

Frontier Developments plc, a software technology company, develops and sells non-game applications and video games for the interactive entertainment sector. It focuses on videogame development across various genres and platforms. The company serves clients in the United Kingdom, the United States, Canada, and internationally. Frontier Developments plc was founded in 1994 and is headquartered in Cambridge, the United Kingdom.

Intercede Group plc, together with its subsidiaries, develops and supplies identity and credential management software in the United Kingdom, rest of Europe, North America, and internationally. The company offers MyID identity and credential management software system, which enables governments and enterprises to provide secure access to services, facilities, information, and networks by creating trusted digital identities to the employees, citizens, and machines. It also provides MyTAM, a cloud-based service enabling Android app developers and service providers to deploy trusted applications to the trusted execution environment; and RapID, a cloud-based solution that offers the ability for app developers to build authentication into their applications, using a few lines of code available via a self-service SDK. The company delivers solutions to customers in the United States and the United Kingdom governments, corporations, telecommunication providers, and information technology firms. Intercede Group plc was founded in 1992 and is based in Lutterworth, the United Kingdom.

WANdisco plc engages in the development and provision of collaboration software worldwide. The company provides data replication technology for the storage, scalability, performance, and availability of data and applications for organizations. It offers WANdisco Fusion platform that delivers continuous availability and performance with data consistency across data clusters any distance apart. The company?s patented active-active data replication technology serves high availability requirements, including Hadoop big data and application lifecycle management, including Apache Subversion and Git. It also offers cloud services, such as Amazon S3 active migrator, Google cloud active migrator, and Fusion hybrid cloud services, as well as provides software maintenance services. WANdisco plc was founded in 2005 and is based in Sheffield, the United Kingdom.

Gaming Realms plc develops, publishes, and licenses mobile gaming content in the United Kingdom, the United States, Canada, and internationally. The company operates in two segments, Real Money Gambling and Marketing Services, and Social Gaming and Licensing. Its mobile technology engages in content distribution and monetization across real money and social gaming markets. The company provides various Slingo, bingo, slots, and other casual games; real-money mobile gambling games through Grizzly gaming platform; and free-to-play real money and social games for iOS, Android, and Facebook platforms. In addition, it licenses IP and game content across various gaming and merchandise categories, including lotteries, gaming machines, social slots, and casual game Web portals to third-party operators. Further, the company provides digital marketing services to gaming and non-gaming clients. It has strategic partnerships with Fremantle, Zynga, Ainsworth, NetEnt, Pala Interactive, and Scientific Games. Gaming Realms plc was incorporated in 2001 and is based in London, the United Kingdom.

FDM Group (Holdings) PLC offers IT services in the form of project management, business analysis, data operations, and product and employee support and development.

HIMACS, Ltd. designs, develops, and implements computer systems and system infrastructure.  The Company also provides improvement and maintenance services.

Cube System Inc preliminary provides system solution services for businesses. The main services include system development & construction and consulting services.  The Company also provides system management and maintenance services for database.  Cube System's customers are financial institutions, distributors, and industrial companies.

Tecnos Japan Inc offers support services to implement Enterprise Resource Planning (ERP) Package.  ERP system modules include features and functions for accounting and logistics.

Forth Smart Service PCL develops and manufactures online top-up machines for service providers. The company offers its products for topping-up the prepaid mobile phones and online games, as well as for credit card payment.

Nippon Computer Dynamics Co., Ltd. has three business segments. The System Development segment provides system development services such as consulting, system integration, and maintenance. The Support and Service segment offers tech nical support, help desk services, and outsourcing services. The Parking System segment operates and sells bicycle parking systems.

Hakim Information Technology Company Limited involves in the pre-consultation, program design, software development, construction, integrated debugging, maintenance and upgrades of intelligent engineering. The Company's main products are integrated intelligent solutions.

AGS Corporation is a total information services provider.  The Company provides IT services such as mainframe-based calculation, data entry, and Internet data center (IDC).  AGS also offers system consulting services and designs, develops software for enterprises.

Poletowin Pitcrew Holdings,Inc. provides software and hardware debug and testing services for video games, mobile phone contents, and PC games. The company also offers Internet security and localization services.

Shinsegae Information & Communication Co., Ltd. provides systems integration services. The Company offers solutions to help companies manage customer relationships, operational efficiencies, and financial performance. Shinsegae is also a software distributor such as games and 3D animations as well as application service and e-business solution provider.

Shinsegae Information & Communication Co (035510 KS)

Bright Oceans Inter-Telecom Corporation develops computer application software for telecommunication industry, as well as provides system integration services. The Company also offers technology consulting services.

1Spatial Plc is a business and technology consultant. The Company provides advisory services and distributes software solutions in the corporate performance management market.

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1Spatial Plc (SPA LN)

1Spatial - Enterprise growth through key contract wins

1Spatial has announced several enterprise contract wins across key geographies, with the group executing on its growth strategy through land and...

Edison Investment Research

1Spatial - Improving mix, SaaS potential draws nearer

1Spatial’s H124 results show robust revenue growth and continued improvement in the revenue mix, with recurring revenue growing by 24%. Investment...

Edison Investment Research

1Spatial - SaaS progress and pipeline support prospects

1Spatial’s AGM statement provides further support for our view that the company is establishing a good platform for scalable recurring revenue...

Edison Investment Research

1Spatial - First wins for key SaaS product

1Spatial has won its first two contracts for 1Streetworks, the company’s SaaS-based Traffic Management Plan Automation product. This is an...

Edison Investment Research

1Spatial - New SaaS apps to drive high-margin growth

1Spatial’s full year results confirm the solid progress made over the course of the year with revenue growing 11%, recurring revenues growing 21%...

Edison Investment Research

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