Tuas Ltd. (ASX:TUA) shares rose about 7% to trade above AU$1.56 in the morning session today, after the company released its Fiscal 2022 results. The company reported strong revenue growth and positive EBITDA.
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The New South Wales-headquartered Tuas is a communications network provider operating in Singapore.
Tuas’ earnings results
For the 12 months ending July 2022, Tuas reported a revenue increase of 78.4% to around AU$60 million. It posted positive EBITDA of around AU$16 million, compared to a negative EBITDA of AU$0.5 million in the previous year. The company’s net loss after tax narrowed to about AU$28 million from almost AU$30 million in the previous year. Tuas ended the year with just over AU$52 million in cash and deposits.
Tuas added 195,000 new subscribers to finish the year with 587,000 active customers. The company has begun upgrading its network, with deployment of trial 5G sites set to begin in October 2022.
Tuas estimates that 5G coverage will reach 60% of its network by the end of 2023. Amid the network upgrade program, Tuas estimates its Fiscal 2023 capex to be in the range of AU$47 million to AU$52 million.
Tuas share price prediction
Tuas shares are still down more than 20% so far this year. According to TipRanks’ analyst rating consensus, Tuas stock is a Moderate Buy. The average Tuas share price target of AU$1.65 implies over 6% upside potential.
Final thoughts
Although Tuas is still sustaining losses, its Fiscal 2022 results, showing strong revenue growth, are encouraging. Moreover, the company was able to narrow its net loss and it also continued to expand its subscriber base. The transition to 5G network could unlock more opportunities for the company.
