Two major contract wins push I-Design shares higher

SHARES in I-Design leapt 14 per cent on Friday after the Dundee-based cash machine software specialist landed major contracts with Barclays and American firm Cardtronics.

The British bank has bought a further 1,500 licences to use I-Design’s software to show advertisements on its cash machines, adding to the 4,000 it bought from the firm last year.

Meanwhile, Cardtronics, the world’s largest non-bank cash machine operator, has also acquired 1,500 licences after it won a contract to operate cash machines in Canada for the 7-Eleven convenience store chain. The US firm had previously had 3,000 licences.

Ana Stewart, I-Design’s chief executive, said: “The purchase of additional licences by two of the largest operators of automated telling machines [ATMs] and ATM-managed services worldwide sees I-Design significantly increase licensed ATM numbers in three key territories.”

Shares in I-Design had slumped 11 per cent last Friday after the Red Hot Penny Stocks newsletter cut its recommendation on the company.

But Robert Sanders, an analyst at house broker Westhouse Securities, hit back.

Sanders yesterday said: “Further to our comment earlier this week highlighting the recent share price weakness as an ideal opportunity to buy shares, we are encouraged by the announcement of significant licence extensions to two existing customers.

“We reiterate our investment thesis for I-Design, which is the ability to deliver a highly-geared profit increase from improving revenues. We maintain our 90p target price and ‘strong buy’ recommendation.”

Shares closed up 4.25p on Friday at 34.5p.

Stewart co-founded I-Design in 1991 and floated it on the Alternative Investment Market in 2007. Scottish Enterprise, one of the firm’s biggest shareholders, has been reducing its stake over the past two years.

I-Design, which is chaired by Scots advertising tycoon Jim Faulds, returned its maiden profit during the second half of last year and expects to have stayed in the black during the opening half of its current financial year thanks to its first contract with a Canadian bank.

The deal was sealed thanks to the Scottish firm’s partnership with computing giant IBM. Its other clients include Nationwide Building Society, Royal Bank of Scotland and Santander.

Companies to which it sells advertising space include British Airways, Pizza Hut and T-Mobile.