eResearch | As the coronavirus negatively affects the business world and companies cut or pull guidance, here are three companies, backed by recently released financial results, that have reaffirmed positive growth guidance for 2020:
- Xebec: 2019 Revenue – $49.3 million; 2020 Revenue forecast – $80 to $90 million
- Trulieve: 2019 Revenue – $252.8 million; 2020 Revenue forecast – $380 to $400 million
- Sangoma: F2019 Revenue – $109.6 million; F2020 Revenue forecast – $128 to $132 million
Xebec Adsorption Inc. (TSXV: XBC)
Xebec develops solutions for generation, purification, dehydration, separation, and filtration for gases. As a global provider with over 50 years of experience in adsorption technology, Xebec has focused on supplying the increasing demand of low carbon fuel sources such as Renewable Natural Gas (RNG) and Renewable Hydrogen (RH2).
Q1/2020 Results
On May 27, Xebec posted a 24% revenue growth from $9.8 million in Q1/2019 to $12.2 million in Q1/2020. Higher volumes of cleantech contracts and revenue from the acquisition of CDA Systems completed in December 2019 were the main drivers of the reported result.
2020 Revenue Guidance
Xebec re-affirmed its 2020 revenue guidance to be within the $80 to $90 million range with EBITDA margins between 11% and 13% and net margins within the 7% and 9% range. The backlog increase to $89.8 million in Q1/2020 from $71.9 million in Q1/2019 supports management growth guidance.
Revenue in the Industrial Service & Support segment is expected to reach $30 to $35 million in 2020. This range represents three times the revenue ($11.5 million) reported in 2019. Gross margins should improve to 40% in 2020 from 30% reported in 2019. Revenue from the Cleantech segment should range between $50 and $55 million.
Key Drivers
- To help fuel inorganic growth, Xebec expects two to three acquisitions in 2020.
- Xebec believes the expected reopening of the economies should bring stronger results in the following quarters.
- Xebec expects to announce a partnership to participate in renewable gas projects in Canada within the next few days but does not expect any revenues from this segment in 2020.
Trulieve Cannabis Corp. (CSE: TRUL) (OTCQX: TCNNF)
Trulieve is a leading medical cannabis company in the state of Florida. With its vertically-integrated operation, Trulieve holds approximately 54% of the Florida market share with 48 stores in Florida and 50 stores nationwide.
Q1/2020 Results
On May 20, Trulieve announced record revenue of $96.1 million and EBITDA of $49.4 million in Q1/2020. These numbers represented a growth of 21% and 51% respectively, when compared with Q1/2019.
The Company also holds a strong cash position of $100.8 million as reported on March 31, 2020.
Kim Rivers, CEO, declared the operational results for the quarter were due to market share growth in Florida along with an efficient supply chain meeting the increasing demand.
2020 Revenue Guidance
In 2020, Trulieve expects to grow operations in Massachusetts as well as expand sales in Florida, Connecticut, and California. In 2020, Revenue and EBITDA are expected to be within the $380 million to $400 million and $140 million to $160 million ranges, respectively. The estimates are driven by current markets and regulations, and foreseeable store growth.
Key Drivers
- The strong financial position of the Company provides support to both organic and external growth initiatives.
- Trulieve announced two record revenue days of approximately $2 million each day in April.
Sangoma Technologies Corp. (TSXV: STC)
Sangoma is a leading voice and Unified Communications (UC) solution provider. The Company offers affordable cloud and on-premise UC systems with advanced functionality in over 150 countries.
FQ3/2020 Results
On May 25, Sangoma reported record Revenue of $36.31 million in FQ3/2020. This figure represented an increase of 26% over FQ3/2019 and an increase of 12% over FQ2/2020. Following the same trend, EBITDA reached $6.51 million in the quarter doubling the $3.26 million from the previous quarter.
The revenue increase was due to the acquisition of VoIP Innovations, continued organic growth and recurring revenue.
F2020 Revenue Guidance
Due to the recorded results in FQ3/2020, Sangoma re-stated its F2020 guidance and expects revenue in the $128 to $132 million range and EBITDA in the $19 to 21 million range. Sangoma also informed that uncertainties about the timing of the governments to re-open economies and concerns on supply chain due to COVID-19 have the potential to affect the demand by its customers.
Key Drivers
- Sangoma works innovatively through organic and inorganic growth initiatives.
“We continued to innovate in spite of the disruptions from COVID-19, launching a new line of headsets and our Sangoma Meet cloud service for video based meetings, offering it free of charge during the pandemic. And we completed the acquisition of e4, in order to strengthen our commitment to, and sales capabilities in, the open source market. All in all, a strong quarter during turbulent times”, said Bill Wignall, President and CEO of Sangoma.
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