Straker Translations (ASX:STG) share price leaps 7% on record revenue results

indian man making phone call me gesture over words in foreign languages.

The Straker Translations Ltd (ASX: STG) share price is off to the races this morning, up 6.58% to $1.70 having earlier hit $1.72.

Below we take a look at the highlights from the technology-enabled translation services provider’s half-year financial results for the 6 months ending 30 September (1H FY22).

What half-year results were reported?

The Straker Translations share price is surging after the company reported a 57.6% lift in revenue to a record NZ$23.3 million (AU$22.2 million). Straker credited acquisitions and organic growth for adding NZ$17.0 million in annualised revenue compared to 1H FY21.

Gross profit reached NZ$13.1 million, up 73% from the NZ$7.5 million reported in the prior corresponding half year.

Adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) fell from a profit of NZ$40,000 in the corresponding period to a loss of $1 million for the reported half-year.

The company pointed to the investments it made “to meet the needs of the rapidly scaling IBM business” along with an increased spend on its own sales and marketing for the loss.

Commenting on the results possibly driving the Straker Translations share price today, CEO Grant Straker said:

The transformational deals we struck in the second half of the prior financial year – the acquisition of the US-based Lingotek and the strategic translation contract win with IBM – set us up for continued strong growth…

Since the start of the year translation volumes through our platform have surged. IBM content is now running at more than 10 million words a month up from 1 million in January and is ahead of expectations. We are also delivering translations in 90 different languages up from just two in January and the 55 envisaged when we set this contract in motion.

The Straker Translations share price could also be getting a lift from its strong balance sheet. As at 30 September, the company has NZ$18.2 million cash on hand and no debt.

Straker maintained its guidance for the full 2022 financial year, forecasting revenue will exceed NZ$50 million, up by more than 60% from FY21. It expects gross margin will exceed the 53.4% it recorded in FY21.

Straker Translations share price snapshot

The Straker Translations share price is up 15% in 2021. That compares to a 12% year-to-date gain posted by the All Ordinaries Index (ASX: XAO).

Over the past month shares in Straker Translations have lost 0.6%.

The post Straker Translations (ASX:STG) share price leaps 7% on record revenue results appeared first on The Motley Fool Australia.

Should you invest $1,000 in Straker Translations right now?

Before you consider Straker Translations, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Straker Translations wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Straker Translations. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/3DQwlBh

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s