BATM anticipates beating market expectations in 2019

The London-listed company said its confidence in beating expectations stemmed from "a substantially higher order book at year end" as both its bio-medical and cyber divisions are receiving increasing demand for newly-launched products, as well as "significant" interest in products and solutions that remain in the final stages of development.

Zvi Marom, chief executive of BATM, said: "The momentum achieved in the second half of 2018 has carried into 2019 with a substantially higher backlog of orders than at equivalent period last year. As a result of increased visibility from long-term contracts as well as confirmed projects to be completed in the year, we anticipate revenue and EBITDA growth ahead of market expectations for full year 2019."

For the year ended 31 December, the telecommunications outfit reported revenue of $119.6m, an increase of 12% compared to the year before, though profit before tax fell by 68% to $1.2m as cost of revenues increased by 14% to $85.1m.

Revenues from the bio-medical division increased by 8% to $62.1m while in the networking and cyber arm they jumped 16% to $57.5m.

Cost of revenues increased after the allocation of certain Research & Development expenses to cost of revenues, as BATM began to recognise revenue under a newly signed R&D strategic investment and multiyear joint development agreement with Arm to develop new Arm-compatible NFV ecosystem.

"These full year results are very significant in the history of BATM. They not only reflect the excellent operational results achieved this year but also provide a guide to what we are capable of in the next few years. The investments we have been making in our businesses have enabled us to produce differentiated and best-in-class products that are now entering the commercialisation phase," said Marom.

A note from analysts at Shore Capital said the company's results were "well ahead" of their expectations and added that BATM has "evolved into a strong developer of technology-based solutions".

"With strong development partnerships and an expanding revenue base, the group is poised to deliver further positive news flow through the current year and beyond, in our view. Given the potential for positive operating leverage as business units begin to mature into profitability, we believe that the potential for further upgrades to our forecasts is very positive," said the note.

BATM Advanced Communications' shares were up 5.59% at 49.10p at 1622 GMT.