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Why the Hansen share price is tumbling today

This morning Hansen Technologies Limited (ASX: HSN) reported its half-year results for the period ending December 31 2018. Below is a summary of the results with comparisons to the prior corresponding half year.

  • Net profit of $12.9m, down from $18m
  • Operating revenue of $112.4m, down from $118.4m
  • Adjusted EBITDA of $28.5m, down from $33.8m
  • EBITDA margin of 25.3%, down from 28.6%
  • Adjusted earnings per share 9 cents, down from 11.7 cents
  • Free cash flow of $10.1m
  • Interim dividend of 3 cents per share
  • Net debt of $0.6m, gross outstanding debt of $22.7m
  • Reconfirmed full year outlook for revenue slightly down & expense base flat

The Hansen share price is down 8.3% in response to a relatively disappointing result for investors used to consistent if moderate growth from this founder led software billings business.

Hansen has also pursued an acquisitive growth strategy over the years and given around 18% of it is still owned by the Hansen family it’s unlikely to take excess risks in over-extending its balance sheet or pursuing risky acquisitions.

At $3.10 on a market value around $666 million it looks reasonably good value for a well run business, with a decent track record and outlook.

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Tom Richardson has no position in any of the stocks mentioned.

You can find Tom on Twitter @tommyr345

The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Hansen Technologies. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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