Post-financing, is Intermap still a buy?

Beacon Securities analyst Russell Stanley said in a Sept. 29 report that Intermap Technologies  (Intermap Technologies Stock Quote, Chart, News, Analysts, Financials TSX:IMP) has materially improved its positioning to win new business following the closing of a C$28.8-million bought deal prospectus offering.

He maintained a “Buy” rating and C$5.50 target.

The offering, upsized from an originally announced C$20-million, included full exercise of the overallotment option. Priced at C$3.00 per share, it added 9.6 million shares and increased Intermap’s basic share count by 16% to 71 million. Net proceeds of about US$19-million should leave the Colorado-based geospatial intelligence company with US$27-million in cash and equivalents at the end of the third quarter, according to Stanley.

“This better positions Intermap to compete for business, given certain revenue opportunities (e.g. Indonesia) require bidders to meet balance sheet liquidity requirements,” he said.

Intermap specializes in high-resolution 3D terrain data and Earth surface models. It is currently working under a US$20-million contract awarded in January 2024 to deliver the first phase of Indonesia’s One Map program, covering roughly 10% of the country’s territory. The total program is estimated to represent a US$200-million revenue opportunity.

Indonesia recently issued a request for bids for the next phase of the program. Stanley noted that Intermap is already using the equipment specified, with the scope consistent with its current work, and that experience requirements should favour the incumbent. The RFB gives technical capabilities 60% of the scoring weight, compared with 40% for price. The project covers 1.6 million square kilometres divided into four lots, with Intermap expected to bid on all. Minimum balance sheet liquidity of about US$18-million is also required. Bids are due Oct. 7, with an award scheduled for Dec. 15 and contracts anticipated in January.

“Even if we see some slippage in timelines, this schedule sets up the Indonesian opportunity as a major potential catalyst for IMP in the near-term,” said Stanley.

The analyst also raised his valuation multiple to 13 times fiscal 2026 Adjusted EBITDA from 12 times, pointing to stronger odds of contract wins under liquidity-based criteria. While still at a 39% discount to the more than 21 times multiple assigned to peer BlackSky Technology, the move narrows the gap from earlier levels. Planet Labs trades at an even higher multiple, he added, though Intermap’s stronger expected margins and lower capex requirements should support superior free cash flow.

Stanley said that Intermap should generate Adjusted EBITDA of US$8-million on revenue of US$30-million in fiscal 2025, improving to US$21-million on US$56-million in 2026.

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