The appointment of Simon Kelly to the board just yesterday has resulted in me getting more news alerts for Intecq in the past 24 hours than I did for the whole 6 months prior. Good to hear he's already a shareholder!
From The Australian:
Former Nine COO Simon Kelly joins Intecq board
Former Nine Entertainment chief operating officer Simon Kelly says gaming services business Intecq has been severely undervalued by the market, which has not recognised the company’s annuity-style revenue streams.
Mr Kelly was appointed as a non-executive director of Intecq on Tuesday in his first role since leaving Nine.
“I think there is a real opportunity to unlock the latent value in the company,” Mr Kelly told The Australian.
“It’s an under-appreciated business.”
Intecq trades at a low multiple of less than five times earnings before interest, tax, depreciation and amortisation, on an enterprise value basis.
The appointment came just a day after Mr Kelly finished up at Nine following four years as the free-to-air broadcaster’s COO and chief financial officer.
Mr Kelly, an Intecq shareholder, said the company’s earnings were resilient with about half of the revenues coming from annuity-style streams.
The company provides player loyalty and tracking systems, cashless gaming systems and back-office productivity tools for pubs, clubs and casinos.
Intecq reported half-year net profit of $2.9 million, up 54 per cent for the half year to December 31, 2015.
Revenue increased by 19 per cent to $26.6m over the same period.
Mr Kelly has significant experience in the gaming industry, holding the CFO role at Aristocrat Leisure when Intecq chairman Paul Oneile was the poker machine group’s chief executive.
Intecq was formerly known as eBet but changed its name last year to reflect its aspirations to become a broader-based technology company, moving into adjacent businesses to its core gaming services division.
While Intecq is capitalised at just $65m, it has some big-name institutions on its share register.
Perpetual is the company’s biggest shareholder with a 13.7 per cent stake, while IOOF holdings owns 12.1 per cent.
Meanwhile, REA Group chairman Hamish McLennan has joined the board of Magellan Financial Group, a publicly traded fund manager, as a non-executive director.
ITQ Price at posting:
$3.78 Sentiment: None Disclosure: Held
