In this weeks latest ASX equity research newsletter (free to sign up for) there was a coverage initiation piece on UBN by broker Taylor Collision, rating it as a SPEC BUY.

"UBN provides a software as a service (“SaaS”) solution in the strata management and facilities management outsourcing industries. After a challenging period following the signing of PICA Group in 2015, UBN is close to becoming a cash- flow-positive and profitable business:
• The completion of the roll-out to the PICA Group - The PICA Group has financed the development of the strata software and enabled UBN to offer a best-in-class solution. Having taken significant time and effort, the finalisation and acceptance by PICA vindicates product quality and enables UBN to pivot its focus to sales.
• Most of UBN’s upfront costs including building the platforms, investing in marketing and onboarding some major customers are now complete. As more customers commence paying licencing fees, which are more profitable, UBN should begin to generate strong operating cash flows.
With positive macro-economic themes, quality customers on both platforms and the investment in the product and marketing, UBN is positioned to grow significantly. We initiate coverage of UBN with a Speculative Buy."
 

Full report at the link: https://www.taylorcollison.com.au/wp-content/uploads/2021/09/UBN-Initiation.pdf

Urbanise.com Limited reports H1 FY2021 result

•  Licence revenue of $4.33m, up 14.0% on H1 FY2020
• Total revenue of $5.73m, up 25.6% vs pcp1, 75.6% recurring
•  EBITDA loss of ($0.98m) vs ($1.29m) in H1 FY2020, 24.0% improvement vs pcp
•  Net loss of ($1.42m) vs ($2.06m) in H1 FY2020, 31.0% improvement vs pcp
•  Annualised recurring revenue (ARR)2 of $9.13m, up 16.4% vs pcp
• Backlog3 estimated at $1.40m as at 1 January 2021
•  Underlying average monthly cash used of $281k (H1 FY2020: $218k)
•  Closing cash balance of $9.03m4 and no material debt5
•  COVID-19 Update: No material impact to date on the demand for Urbanise’s cloudbased software

DISC: I hold

21/1/21

Appendix 4C & Quarterly Activities Report for the period ended 31 December 2020

• Q2 FY2021 revenue $2.98m1, up 29.4% vs previous corresponding period (pcp) due to record professional fees for Facilities Management and licence fee growth

• Q2 FY2021 professional fees of $711k1, up 118.8% vs pcp reflecting recent contract wins and expanding customer base among asset owners as well as Tier 2 FM outsourcers

• Q2 FY2021 recurring licence revenue of $2.26m1, up 15.2% vs pcp as a 27.3% increase in Strata licence fees due to progress on PICA implementation and new Dubai Asset Management contract was offset by a mixed performance in the Middle East

• H1 FY2021 revenue of $5.73m1, up 25.6% vs pcp and licence fee revenue of $4.33m1, up 14.0% vs pcp; 75.6% recurring revenue

• Underlying2 cash out flow of $870k1 in Q2 FY2021 and underlying average monthly cash used of $290k largely reflecting additional investment in sales and marketing

• Closing cash balance of $9.03m1 (31 Dec 2019: $4.59m) and no material debt3 following successful completion of $6.80m placement during the December quarter

• COVID-19 Update: To date, there has been no material impact on the demand for Urbanise’s cloud-based software

• Urbanise’s H1 FY2021 result will be released in February

DISC: I have small holding

Urbanise has reported a 27% improvement in Q4 revenue, which came in at $2.61m. For the full year revenue was up 19.5% to $9.65m.

Cash flow positive, thanks in part to deferred costs and tax relief associated with Covid. But importantly, it was also driven by good cost control, with monthly cash usage back to 2014 levels. 

Current cash holdings of $4.55m, no material debt.

No impact from covid.

Shares presently on a market cap of ~$50m, so on a price to sales ratio of 5.2x. Not crazy in this market and given strong revenue growth

This company has been plagued by poor cost decipline in the past, so really good seeing the new team getting the ship in order. Always interested by stocks with:

• Strong top line growth
• Long growth runway
• Best in class product
• At or approaching a breakeven inflection point
• Low debt and sufficient cash reserves
• Sticky customers
• Positive operating leverage

Urbanise seems to fit the bill, although i need to do a lot more due dilligence.

ASX anouncement here

Hardly a stonk, but better than many,

the share price is down, but I haven't sold any.