Crimson Tide provides profits upgrade

AIM-listed penny share provides positive trading update

Crimson Tide provides profits upgrade

AIM-listed Crimson Tide (TIDE) has announced that its pre-tax profit for the year ended 31 December 2014 will be ahead of market expectations.

In a note issued today, Eric Burns, analyst at house broker WH Ireland, increased his 2014 estimated pre-tax profit for 2014 to £150,000, from £131,000 previously.

Burns explained: “One of TIDE’s attractions to investors is its high level of operational gearing: if it can turn a decent profit on its existing subscriber base of just 1,600 users (FY14 year-end estimate), then there is the clear scope for a quantum leap in profitability if it can grow this level materially.”

At the moment Burns is holding his 2.25p price target, which equates to roughly 10 times his earnings per share forecast of 0.21p for the full year 2017.

He told Every Investor. “Its recent £250,000 financing deal with Lombard has given Crimson Tide the firepower to fund further expansion – where they bundle hardware with their software subscription package. It’s a positive sign as there is the opportunity to get their subscription package not just to 2,000 users but to many multiples of this.”

Much hinges on the successful roll out of Crimson Tide’s MPRO 5 software with a global food and beverage company and it appears to be going very well, as today’s announcement indicated: “The roll out of mpro5 to the food and beverage company has gone well in Australia .The Company expects further expansion of this opportunity and the next deliveries are planned for Germany and North America. The client has expressed its satisfaction with the services provided. The Company continues to work on larger opportunities and is confident of progress.”

Learn more

If you’d like to learn more about Crimson Tide, watch this video interview with chairman and chief executive Barry Whipp.

 

The writer holds shares in Crimson Tide

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About Author

Christopher Menon

Every Investor Editor Chris Menon is a financial journalist who has written regularly for national newspapers, magazines and websites about personal finance, with particular emphasis on investing.