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(Sharecast News) - CyanConnode shares were sliding on Thursday, even after it reported strong interim growth as an accelerating smart meter rollout in India drove higher revenues and a sharp increase in its contracted order book.
The AIM-traded smart metering specialist said revenue for the six months ended 30 September rose 32% to 7.4m, or more than 40% on a constant currency basis, reflecting increased hardware shipments.
Gross profit declined to 1.9m from 2.3m a year earlier as margins fell to 25% from 41%, primarily due to a lower contribution from software and services and lower pricing on certain contracts ahead of the rollout of higher-margin products.
The operating loss widened to 3m from 2.1m, largely due to 0.9m of foreign exchange losses, while cash received from customers was broadly flat at 7.4m.
Cash and cash equivalents at the period end stood at 1.6m, compared with 3.7m at the end of the 2025 financial year.
The group said it also held 6m on fixed deposits at ICICI Bank in London, securing an overdraft facility in India for the same amount.
During the period, CyanConnode raised $15m through two convertible loan notes to support working capital and contract bidding.
Chief executive John Cronin said the group had delivered a successful first half, highlighting the award in April of its first advanced metering infrastructure service provider contract in Goa, its largest to date.
"This milestone win has significantly increased our scale and strengthened our ability to win additional AMISP contracts, alongside ongoing subcontracting opportunities," he said, adding that the contract nearly doubled the group's order book to 157m at the end of September.
Cronin said India remained CyanConnode's largest market, with a serviceable obtainable market of 231m, supported by the Indian government's push to address electricity theft and inefficiencies through the revised national smart metering programme.
He said the acceleration of the programme was "creating a positive tail wind which is reflected in our revenue performance," while the company also strengthened its position outside India, including a 1.2m cellular gateways order in the Middle East and North Africa.
"With 17 live smart metering projects and revenue generation from the Goa project expected to begin in earnest shortly, the business is well-positioned for sustained growth through the remainder of FY 2026 and into FY 2027," Cronin added.
Operationally, CyanConnode shipped 893,000 Omnimesh modules during the period, up from 377,000 a year earlier, and said the Goa project has been fully funded and resourced through an agreement with a specialist multinational contractor, without additional capital requirements from the group.
Post-period, the company raised a further $5.25m via a convertible loan note in November to support deposits for AMISP tenders, and said key operational metrics remained positive heading into the second half.
At 1425 GMT, shares in CyanConnode Holdings were down 16.55% at 6.05p.
Reporting by Josh White for Sharecast.com.