Veda Group Ltd (ASX: VED) has reported a half-year net profit after tax (NPAT) of $38.06 million which compares favourably to the $12.48 million loss it recorded in the same period last year. The result was underpinned by strong sales growth whereby revenues for the period jumped 11% to $163 million.
So What: The data analytics business said that revenue growth was driven by all business lines, while expansion in its B2C and Marketing business line played a particularly strong role, with revenues up 29.9% against the prior corresponding period. Consumer Risk and Identity revenues were up 8.7%, while Commercial Risk and Information Services revenues jumped 7.5%.
However, these gains were offset somewhat by higher operating costs which grew 11.5% on a pro-forma basis to $93.7 million. This came as a result of expenses related to delivering sales growth, while heavy investments in staff were also made to support the transition into Comprehensive Credit Reporting. As such, pro-forma EBITDA (earnings before interest, tax, depreciation and amortisation) was up 10.4% to $62.8 million.
Veda Group also announced that its Chief Data Officer, Simon Bligh, has resigned from his role citing family reasons. The company is close to appointing someone to replace him with details of the appointment to be made in the near future.
Now What: Veda Group’s CEO, Nerida Caesar, confirmed the company’s full-year guidance to advise for “at least low double digit growth over FY14” for EBITDA, while its NPAT growth rate will be slightly higher than the EBITDA growth rate. Although the stock isn’t cheap at today’s price of $2.35, it still appears to be an excellent buy for long-term focused investors.