Mobile subscriber retention services provider CDialogues doubled its interim profit but cash conversion is not as good as it was.
CDialogues is currently focused on the Middle East, and Iraq in particular. CDialogues is dependent on one large customer but up until now cash generation has been good. CDialogues is trying to diversify its customer base and it did continue to generate cash in the first half of 2014 - just not as much as would have been hoped.
In the six months to June 2014, revenues jumped 106% to €4.05m, while pre-tax profit increased by 116% to €1.29m. CDialogues joined AIM at the end of June so the earnings per share were not significantly hit by the additional shares in issue and this doubled to €0.227.
Net cash was €1.75m, which is after receiving €638,000 from the flotation. Cash flow from operating activities was €695,000 compared with pre-tax profit of €1.29m. There was a large increase in working capital which was predominantly down to a €938,000 increase in trade debtors. Nearly all of this increase was due to accrued income rising to €1.73m. That is a high figure when compared with revenues of €4.05m in the period. The accrued revenues were partly offset by €762,000 of accrued expenses.
New campaigns were launched in July and August so they were not covered by these figures. CDialogues currently works for six mobile operators in three countries and they have 31m subscribers.
The shares shrugged off the poorer cash generation and rose 15p to 280p, which values the company at £17.5m. CDialogues joined AIM on 27 June and it raised £1.25m at 212p a share.
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