Software firm with strong market position Wimbledon-based StatPro is a software provider to the fund management industry. The company has been quoted on AIM for more than ten years. StatPro enjoys a strong position in its markets and is a longstanding dividend payer. Today, StatPro is one of AIM’s mature mid-sized companies. StatPro produces portfolio analysis software for fund managers. Its products deliver risk statistics and performance data. This information is used to determine if portfolio allocation is appropriate and which decisions have led to the fund performance being delivered.
where there is regulation, there is revenue The company’s flagship product is Revolution. According to the company, this product helps clients ‘increase their sales, enhance their client service, meet tough regulations and reduce costs.’ StatPro demonstrates well that where there is regulation, there is revenue. Such regulations can involve the way that fund performance is reported, with rules and standards varying between jurisdictions. Like many software companies, in recent years, StatPro has moved to a cloud-based service, with a rental pricing model. This makes comparisons with past years difficult. Recent announcements from the company highlight StatPro’s continued standing in the market. In the first week of January, a three www.aimprospector.co.uk
year agreement with a European asset manager was announced. This deal is valued at around £3.1m for the duration. The fact that a price premium of 55% over the previous contract was secured will encourage shareholders. As StatPro has matured and secured a stronger position in its marketplace, shareholders have been rewarded along the way. The company first paid a dividend of 0.5p for the financial year 2005. Since then, the payout has been increased year-onyear, reaching 2.8p for 2013. At the half-year stage, the dividend was held. However, according to Stockopedia, a 3.6% dividend increase for the full year is still forecast.
a price premium of 55% over the previous contract was secured The Q3 trading update exposed the movement in revenues as clients switch to a cloud provision. Recurring revenues increased 35% versus the previous nine months. Almost all of this increase was delivered by StatPro Revolution. 2015 is an important year
for StatPro. The company will be releasing StatPro R+, the cloud-based version of its installed StatPro Seven product. Customer migration will be a considerable challenge: StatPro Seven has around 250 current clients. Although the migration process will take years to complete, the success of Revolution gives considerable encouragement.
customer migration will be a considerable challenge The history of AIM abounds with successful companies being bought out. While the move to cloud services creates significant uncertainty in the short term for StatPro, it is not hard to imagine that some potential acquirer will be keenly waiting to see if the new product is a winner. StatPro will announce final results for 2014 on March 10th. StatPro Group (LON:SOG) FOR Market leader Long-running successful team AGAINST R+ integration risk Dividend cover appears thin Market cap Bid:offer P/E (forecast) Yield (forecast) 52week low:high
£51m 73p:75p 26.8 3.9% 70p:92p
Published on Mar 3, 2015