Bigblu Broadband short-term debt position leads share price dip

Bigblu Broadband short-term debt position leads share price dip

Alternative provider of fast broadband services, Bigblu Broadband plc (AIM: BBB.L) posted steady progress across most of its fundamentals, despite its debt widening on further investment.

The Company said that, “In order to support further growth through the EBI partnership via the one-off transition of customers from the historic Viasat joint venture, the Company increased investment in stock during the second half.”

In turn, it said that, “whilst Net Debt over the course of the year was in line with previous guidance, as at the 30 November year-end date, it was temporarily higher than expectations at approximately £14.2 million vs £16.9m at the half year.”

It said that this figure reflected some short-term timing issues and exceptional costs associated with the Viasat agreement, and said management were confident its debt position would reduce ‘significantly’ in the near future.

Beside that point, Bigblu Broadband said trading for the year was ‘in line with management expectations’, with improvement seen in its customer additions, revenue growth, ARPU’s and EBITDA margin.

The Company said that during the period, it had also secured new funding to accelerate Quickline’s growth plans, and had launched a new partnership with Eurobroadband Infrastructure.

Elsewhere in the tech sector, Falanx Group (AIM: FLX) saw their losses widen, ULS Technology plc (AIM: ULS) suffered in a challenging market, Solid State plc (LON: SOLI) boasted a strong first half and IMImobile PLC (LON: IMO) posted strong half-year results.

BigBlu Broadband comments 

Andrew Walwyn, CEO of BBB, added the following insights,

We are delighted with the continued strong performance across all of our key metrics with increasing levels of organic revenue highlighting the growing maturity of our business model and our ability to deliver increasing returns.”

“Importantly, we are now generating high levels of recurring revenue as we move towards profitability and continue to be a market leader in a rapidly growing sector with strong markers for increases in demand and spend from existing and new customers. Given our proven model, the strong market dynamics and technology advances, we believe that Bigblu represents a favourable customer choice against traditional alternative solutions and remains extremely well placed to take advantage of growth opportunities in the sector in 2020 and beyond, and therefore we are confident with market expectations for revenue and EBITDA.  As such, we look forward to the forthcoming year with optimism working with excellent network partners to drive continued customer growth with continuously improving excellent products.

Investor notes

After a slight recovery, the Company’s shares were down 6.16% or 6.75p to 102.75p per share 05/12/19 14:05 GMT. Analysts from Barclays Capital initiated its ‘Overweight’ stance on Bigblu Broadband stock. Neither the Group’s p/e ratio, nor their dividend yield, are available. Their market cap is £59.59 million.