Focusrite (TUNE)

Business description

Focusrite is a global music and audio products group supplying hardware and software products used by professional and amateur musicians, which enable the high-quality production of music.

Y/E Aug Revenue (£m) EBITDA (£m) PBT (£m) EPS (p) P/E (x) P/CF (x)
2016A 54.3 10.2 7.7 11.8 27.1 N/A
2017A 66.1 13.1 9.5 14.8 21.6 N/A
2018E 72.7 13.8 10.0 15.3 20.9 N/A
2019E 78.6 14.8 10.6 15.9 20.1 N/A

Last updated on 12/12/2017

Investment summary

FY17 EPS grew by 30%, beating our forecast by 6%. Revenue grew 21.6% (13.5% at constant currency), with growth across both brands and in all regions, but led by the US. The strategy is evolving to emphasise actions to grow the customer base, increase lifetime value of customers, and expand into new markets. Two new brands are being launched: Focusrite Pro, to target the professional interface market, and Ampify, to develop the app market. We upgraded our forecast FY18 EPS by 5.1%, the third time this year.

Last updated on 13/12/2017

Industry outlook

Focusrite’s products connect with a home-based leisure movement that is outpacing overall consumer expenditure. The global music instrument and pro audio wholesale market was £2.7bn in 2013 (source MTM) but is highly fragmented. At IPO in 2014, management estimated its addressable market at c £450m. Currently, it estimates a 50% share of the mass interface market, c 10% of the semi-professional Thunderbolt market and 2% of the commercial market, with Novation, maker of the Launchpad, also ranking highly in its markets.

Last updated on 13/12/2017

Key management

Phil Dudderidge, Chairman
Tim Carroll, CEO
Jeremy Wilson , CFO

Company address

Windsor House
Turnpike Road
HP12 3FX
United Kingdom
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