SLI Systems (SLI)

Business description

SLI Systems' core products are e-commerce site search and navigation tools that learn from customer behaviours to improve the relevance of search results and therefore increase sales conversion.

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Stock data

Market cap.NZ$80.3m
Last closeNZ$1.32
High / Low (52 weeks)NZ$2.8 / NZ$1.3
Stock market listingNZ
Forecast net cash (NZ$m)6.7
Forecast gearing ratio (%)N/A
TeamTechnology
SectorTechnology

Price performance

%1m3m12m
Actual(5)(20.5)(34.3)
Relative *(5.5)(21.2)(38.4)

* % Relative to local index

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Y/E Jun Revenue (NZ$m) EBITDA (NZ$m) PBT (NZ$m) EPS (fd) (c) P/E (x) P/CF (x)
2013A 19.0 (1.4) (1.6) (2.9) N/A N/A
2014A 22.4 (5.4) (5.4) (8.6) N/A N/A
2015E 30.1 (4.0) (4.4) (7.3) N/A N/A
2016E 40.0 (1.5) (1.9) (3.1) N/A N/A

Last updated on 01/09/2014

Investment summary

SLI Systems' FY14 results were broadly in line with expectations although ARR was slightly (3.8%) lower than forecast due to the delays in hiring sales and marketing staff as described in the trading update at the end of July. We do not see this as material and do not feel it affects the investment case. Earnings were NZ$1.2m (16.5%) better than forecast due to the lower than expected expenditure on sales and marketing. Management has signalled that it is willing to grow via acquisition following approaches from a number of companies. We will shortly be publishing an update note with further analysis of the results.

Last updated on 01/09/2014

Industry outlook

E-commerce site search is a growth market, thanks to the overall growth in e-commerce and the importance of effective search in converting website visits to sales. SLI Systems' cloud-based product minimises the initial set-up costs for its customers, resulting in a high ROI in a short time frame. Global e-commerce sales are expected to grow by 20.2% in FY14.

Last updated on 01/09/2014

Key management

Greg Cross, Chairman
Rod Garrett, CFO
Dr Shaun Ryan , CEO and Founder

Company address

78-106 Manchester Street
Christchurch 8011
New Zealand
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