Accesso Technologies LON:ACSO the AIM-listed technology company based in Berkshire, published a trading update today (29th January). The company provides technology that provides point-of-sale ticketing, virtual queuing distribution and guest experience management solutions.
Accesso’s recent history began in 2012, when AIM-listed Lo-Q, a British tech firm established by entrepreneur, Leonard Sim, acquired a US company built through an asset purchase from another technology company that had previously entered bankruptcy. Lo-Q was already established in support services to the entertainment and events industry and saw the opportunity to acquire the IP of the previous firm, which was being held in a vehicle named Accesso. Sim combined the entities and rebranded his listed company Accesso.
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Lo-Q was focused on ride-reservation systems for theme parks, whereas Accesso concentrated upon online and mobile ticket sales software and the management of online ticket stores and the merger was quite synergetic.
Accesso Technologies growing through acquisition
The company then went on an acquisition programme, buying complementary technology businesses in ticketing to build scale between 2013 and 2017. The Reading-based business continued its opportunistic acquisitions programme, buying VGS, a ticketing and management platform for USD38.5m in June last year. The company has a strong client roster and its acquisition by Accesso increases its international reach, blue-chip customer base and creates an immediate earnings accretion.
The VGS acquisition followed previous acquisitions of Paradocs Mountain Software and Digisoft in 2023.
Accesso said in its trading statement that it was expecting revenues of at least USD148.5m for the year, which it said was up 6% year-on-year and cash EBITDA in line with expectations at a margin of at least 15%. The company’s earnings were improved as a result of its VGS acquisition and previous acquisitions of Paradocs and Digisoft.
The technology business said that in the last year it has raised its line of sight concentrating on higher margin business and choosing to move away from lower-margin opportunities. The company also made its first sales in Saudi Arabia after year end, through its Horizon subsidiary, which marked the entry into a new market for the technology company.
Targeting cash EBITDA margin growth
Accesso is targeting 9% revenue growth this year and is hoping to expand its geographic diversification expecting an improvement in cash EBITDA margins to not less than 17%, with a medium-term cash EBITDA target of 20%.
The company opened trading today at 530.9p jumping 3.6% in early trading to 550p. However over one-year performance has been somewhat more disappointing with Accesso’s shares falling about 34%, and over the longer period of five-years, down 63.4%. It is hoped that as the economy recovers, theme parks and attractions will start to see greater footfall and its international acquisitions will start to contribute more significantly to the bottom-line.
The company has a market capitalisation of GBP218.6m and in October last year initiated a GBP4m share buy-back programme.
Shore Capital recommends Accesso as a ‘Buy’. Katie Cousins, a research analyst for the broker said: “[Accesso] is currently trading on an EV/cash EBITDA of 8x and EV/Sales of 1.5x for FY24F, a discount to both US SaaS and UK SaaS/IT services peers which trade on an EV/Sales of c.6x and c.3x respectively.
We believe there is a fundamentally attractive long-term investment case, with the group operating in a structurally growing market with an increasing number of visitors and demand for digitalisation. [Accesso] is a key partner in helping its customers gain a greater share of visitors’ wallets, as well as improve overall efficiency, and its pleasing to see its exposure in both geography and clients grow.”
