Spectra Systems Corp - spsy:LSE

“As part of our efforts to increase shareholder value, we have undertaken efforts to invest in early stage companies which are in high value businesses such as healthcare, biotechnology and energy”
Latest company presentation these new investment opportunities are valued at zero. spsy is full with potential and diversifying revenue streams and recently invested in Solaris Biosciences -

“The first of these investments is Solaris BioSciences, an early stage company focused on the development of technologies capable of detecting changes in nanoparticle transport through extremely small amounts of bio fluids to determine viscosity and detect molecular species of interest on timescales of minutes. Target molecules include such as viral RNA, at levels which may not require PCR amplification, proteins and antibodies. This first investment leverages our expertise in laser systems and compact mechanical and optical designs and will leverage world class biotechnology collaborations with Brown University school of Engineering and the Brown University Medical School.”

Enterprise value/net profit is 17x for a cash generative business that is still growing. With the focus in investing in the early startups and gives a good blend of a cash cow and growth.

Board of directors recent share buy backs - 200k shares at 169p.

Strong sign of confidence from the Board of directors

https://www.londonstockexchange.com/news-article/SPSY/share-buy-back/14813712

Spectra Systems Corporation provides technology-based security solutions. The Company operates in three segments: Authentication Systems Group, which captures the hardware, software and materials related to banknote, tax stamp and other high value goods; Secure Software Transactions Group, which provides an internal control system (ICS) software offering to the lottery and gaming industries, and Banknote Cleaning Group, which captures the technology related to cleaning soiled banknotes. ICS provides tools for fraud detection, money laundering, match fixing and statistical analysis. The Company develops and sells integrated optical systems across a spectrum of markets, including currency manufacturing and cleaning, branded products, industrial logistics and other highly sensitive documents. The Company’s solutions include engineered materials, sensors and quality control equipment. The Company’s materials are available in several forms, including particles, threads, inks and coatings.

Impressive company with double digit growth during COVID *don’t hold but on watch list for a while now

The group’s a world leader in providing security technology materials for use in banknotes, product authentication, and gaming.

  • Revenue +11% to $14.675m,
  • Adjusted EBITDA +16% to $6.357m,
  • Net income +18% to $5.124m,
  • Adjusted earnings per share +14% to 11.9c,
  • Cash from operations -3.7% to $5.124m,
  • Net cash position steady at $14.038m (with $1.099m of restricted cash and investments); no debt,
  • Annual dividend of 9.5c per share,
  • 645,000 shares bought back in the period.
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