There is lots to read in the acquisition of AssetOn

Probably only positive is the potential cross selling opps. Also some ARR earned from the assetOn OnPlan offering although it is small.

Negatives I see are:

* Ebitda margins being reduced after acquisition (was already falling in latest update)

* Not much detail on what MDaaS (Master data as a service) actually is. But it looks like a semi automated processing of asset data to more useable format

* Discounted 15m placement of 76.5c (but was oversubscribed)

* Earnouts seem generous

Out for now even though I see Bell potter increasing their target price.

In case some haven't realised, Cosol has made an acquisition of a business called AssetOn for 22m

Still looking into this and the equity raise. Unless I see another straw on this, I will post my thoughts later

[held]

Deep dive into COSOL.... This is my first deep dive into software services even though I have a IT background so I may get a few things wrong.

Background

COSOL business is providing solutions and services for organisations looking to optimise or modernise their enterprise asset management systems. COSOL business cover the following areas:

Advisory services

Advisory , Implementations, Upgrades, Support of EAM (Enterprise Asset Management) platforms including Hitachi ABB Ellipse, IBM Maximo and SAP.

Technology solutions

COSOL has their own proprietary software solutions that add functionality and optimise existing EAM platforms such as RP Connect, Evergreen and Copernicus which is now combined as their EAMaas.

RP Connect assists with interfacing and migrating legacy systems to modern enterprise asset platforms.

Evergreen helps optimise implementations and upgrades of EAM/ERP environments – more specifically with Hitachi ABB Power Grid.

Copernicus assists with deployment and management of EAM / ERP for the mining sector

Managed services.

EAM and non-EAM Application Management Services, Desktop, Datacentre, Telecommunication and Cloud Management Services

Group revenue

48.3M +44% (of which 32% is products and services, 36% professional services and 32% support services). There is no breakdown on how much revenue is recurring, but they seem to be relying on their recent acquisitions to make revenue more recurring.

EBIT

8.1M +40%

EBIT Margin

Quite small at 16.7%

NPAT

5.5M +38%

Market cap

As of FY22 results $96m

Div 1.92c EPS 4c

Acquisitions –

Clarita (2021) - specialise in IBM Maximo solutions for EAM/ERP

WMS (2022) - specialists in EAM solutions for the mining sector

Client list:

Large variety of blue chip clients as seen below.

Significant contract wins which give detail into some capabilities:

In summary COSOL appears to be a technology enabler but they have a proprietary set of technologies and specialists to assist organisations in modernising and extracting extra features from their EAM/ERP environments rather than having their own standalone solution that competes with other companies such as IBM. This "add-on" enabler model may explain the current discount on the share price.

[held]

FYI: I'll do a deep dive on COS soon

Meanwhile an announcement came out about a 8.2m contract extension for further work from the Department of defence.

[held]

I haven't really spent time doing a deep dive on this tech stock but liked what I saw.

Not sure why it is quiet here. Too early since listing? Maybe under the radar? Maybe too many "earnings accretive" acquisitions in a similar vein to Vocus, IPD Group or Uniti (although 2 since IPO doesn't seem too bad)? Maybe a small insider sale recently (although that was quite small amount)

Or maybe I'm missing some other red flag no one has cared to mention?

But going by this slide it seems like they are firing on all cylinders

Be interesting how this fairs during a macro downturn. Seems like the recently acquired another lower margin but EPS accretive biz called WMS maybe to get additional clients on board.

Willing to take a risk though given the small market cap (smaller than the more popular Smartpay I may add which is just at inflection point)

[held]