.jpg;140;64){kind=logo}
Incadea appears to be expanding into new geographical markets faster than forecast, as illustrated by the fact is it is consuming cash at a faster rate than expected. Nonetheless, the Salzburg-based SITS provider to the global automotive industry remained debt free at the year-end (FY12) with a cash balance of €2.3m and a positive operating cash flow.
The company floated on the AIM market in May last year (See One departs aim, another arrives...). Today’s maiden full year results reveal that it continues to grow strongly with revenue up 49% to €29.3m (albeit a slowdown compared to the half year results which revealed 64% growth – see Incadea delivers strong maiden results). The growth is down to OEM (car manufacturer) customer expansion in BRIC and other emerging markets, while other regions such as Austria and Spain have suffered due to tough economic conditions. The proportion of revenues coming from direct sales has also altered significantly (73.5% vs. 53% in 2011) as the company progresses to becoming a full software and services provider (services growth was 71% vs. growth of 33% for licenses and 35% for maintenance).
Incadea has a careful balancing act to maintain so that it doesn’t become the victim of its own success. As it readily states, it faces the challenges of international expansion, corporate development, and a change in the business mix with more emphasis on consulting and project management. On top of that it is moving increasingly to a SaaS delivery model. That’s a lot for a small company to be dealing with. But so far so good.