The Tesserent Ltd (ASX: TNT) share price is struggling to catch a bid on Monday after the company released its preliminary FY21 results.
At the time of writing, shares in the cyber security company are trading flat at 27 cents .
Tesserent share price flat despite bumper FY21 performance
The Tesserent share price is off to a wobbly start on Monday despite marking significant growth and a pathway towards profitability in FY21. Key highlights include:
- Turnover surging 371% to $96.7 million
- Revenue lifting 233% to $67.3 million
- Normalised earnings before interest, tax, depreciation and amortisation (EBITDA) of $9.6 million (FY20: $2.8 million loss)
- Normalised net profit after tax of $4.9 million (FY20: $5.1 million loss).
What happened to Tesserent in FY21?
FY21 marked a year of significant growth for the cyber security company.
Tesserent successfully executed its strategy to strengthen its core Cyber 360 capabilities and acquire complementary businesses to expand product and service offerings to key clients and sectors.
During the year, Tesserent acquired and integrated six companies including:
- Seer Security on 31 July 2020
- Airloom Holdings on 2 September 2020
- Ludus Information Security on 11 September 2020
- iQ3 on 11 November 2020
- Lateral Security Services (New Zealand) on 12 February 2021
- Secure Logic on 28 April 2021.
Tesserent achieved all set financial objectives in FY21 including a turnaround to achieve quarter-on-quarter EBITDA growth from a quarterly loss-making position in the prior year and a turnover run rate of $150 million.
Contrary to its positive FY21 performance, the Tesserent share price is down 22.8% year-to-date and flat for the past 12 months.
Management commentary
In a letter to shareholders, Tesserent chair Geoff Lord wrote:
FY21 saw the group achieve exceptional growth – both organically through its execution of the Cyber 360 go-to-market strategy and through successful completion and integration of six acquisitions – with the acquired businesses adding public and private sector consulting services, managed services, specialised product expertise, plus cloud, defend and detect services to the Tesserent offering.
Pleasingly, the FY22 year has started off well for the group with the business delivering above budget performance and a number of wins that will provide a foundation for continued strong organic growth during the current year.
What's next for Tesserent
It's been a challenging past 12 months for the Tesserent share price.
Management said that it would continue to focus on creating shareholder value by "building on Tesserent's position as Australia's #1 ASX-listed cybersecurity provider".
Tesserent highlighted a number of "important goals" over the new financial year, centred around acquisitions, the expansion of proprietary intellectual property and driving market share in key sectors.
Lord said the acquisition of Loop Secure would be completed in September. "There are also a number of potential acquisitions currently in review which if completed, will further add to the inorganic earnings growth and deepen the Cyber 360 model," he said.
In addition, the company pointed at international expansion opportunities with a focus on Australia's key five eyes allies, consisting of the United States, United Kingdom, New Zealand and Canada.
