Image source: © Wrightstudio | Megapixl.com

Highlights

  • IMDEX is an ASX-listed mining-tech company that offers cloud-connected sensors and drilling optimization products
  • For the quarter ended 30 September 2023, IMD witnessed 19% YoY surge in revenue to AUD 126.1 million
  • L1 Capital Pty Ltd. has the highest stake in IMD with a shareholding of around 15.90%

IMDEX Limited (ASX: IMD) is an international mining-tech company that provides cloud-connected sensors and drilling optimization products. The company mainly caters to resource companies and drilling contractors. IMDEX has a 40% interest in Krux Analytics and has acquired Devico. In this article Kalkine analyses how IMD has performed over the previous five years, using fundamental analysis.

Krux Analytics is a leading drilling analytics software firm and Devico is a directional core drilling provider.

The AUD 873.03 million-marketcap company recorded nearly 20.36% YoY increase in revenue to AUD 411.40 million in FY23, that ended on 30 June 2023. During the reported period, the company delivered 16.87% YoY rise in normalized EBITDA to AUD 122.6 million, while its net profit after tax declined by 21.70% YoY to AUD 35 million. The decline in its net profit was primarily because of the costs related to integration and acquisition of Devico.

On 28 February 2023, the company concluded the acquisition of Devico, a mining-tech firm.

Recent quarter performance

During the quarter ended 30 September 2023, the company registered 19% YoY increase in its revenue to AUD 126.1 million, and Devico contribution in the revenue was AUD 18.2 million, surpassing the expectations of IMD. Excluding Devico’s revenue contribution, unaudited revenue stood at AUD 107.9 million, up 2% YoY.

How IMD has performed over the last 5 years

IMD's revenue has increased from AUD 243.70mn in FY19 to AUD 411.40mn in FY23, reflecting a CAGR of ~14%. Over the last five years, its EBITDA margin has also improved from 21.50% in FY19 to 30.20% in FY23, showing improvement in its operational efficiency. However, its leverage has increased over the years, as reflected by its Debt/Equity ratio, which stood at 0.29x at the end of FY23 vs 0.03x at the end of FY19.

Top 10 shareholders of IMD

The top 10 shareholders of IMD have nearly 42.64% shareholding in the company, while the top four have around 29.67% shareholding. The top two shareholders of IMD are L1 Capital Pty Ltd. and Fidelity Management & Research Company LLC, with a shareholding of ~15.90% and ~5.54%, respectively.

Recent business update

On 19 January 2024., the company had shared an update on its half yearly results for FY24. The company notified that it would release its 1HFY24 results on 19 February 2024. Paul House, CEO of IMD and Paul Evans, CFO would share an overview of 1HFY324 performance along with progress with its growth strategy.

Through an ASX release dated 17 January 2024, the company informed that UBS Group AG and associated corporate bodies ceased to be substantial holders in the company on 15 January.

Outlook

For the rest of FY24, the company expects market demand to remain steady as resource companies continue to respond to a high-cost environment.

The company is committed to continuing investing in its new business – Digital and IMT products. The company believes that Digital 2.0 will play an integral part in bringing efficiency to the business.

Share performance of IMD

IMD shares closed 1.52% up at AUD 1.675 apiece on 23 January 2024. Including today’s gain, IMD’s share price has fallen by 35.08% in the past 12 months and in the last three months, it has incaresed by 9.48%.

The 52-week high of IMD is AUD 2.64, recorded on 2 February 2023, and the 52-week low is AUD 1.365, recorded on 12 October 2023.

Note 1: Past performance is neither an Indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, and currency, is 23 January 2024. The reference data in this report has been partly sourced from REFINITIV.