IS Research - Informed, Insight and Integrity

Norcon, the telecoms consultancy and systems integrator, has announced that first half revenues have been slightly weaker than expected, due to delayed contract timings, with revenues 5% below management expectations. However, the company remains upbeat about prospects, given a strong order book, and looming industry spend on LTE. We spoke briefly to CFO Marne Martin this morning, who was upbeat despite the slight revenue under-performance. The company is experiencing solid ongoing work from existing clients, at continued good margins, but is seeing longer than expected conversion of new prospects to sales.  However, with most mobile operators worldwide now either in the processing of planning for LTE, or starting to evaluate strategies, and a few actually rolling out networks, the prospects for Norcon remain solid.  The company remains on the lookout for M&A opportunities, and Marne noted that the M&A environment is becoming more attractive for buyers. Due to the slight revenue shortfall, we will revisit our forecasts in the next few days.