TIDMIDEA
RNS Number : 0507F
Ideagen PLC
12 November 2020
12 November 2020
Ideagen PLC
("Ideagen," "the Company" or the "Group")
Pre-Close Trading Update and Board Changes
Ideagen PLC (AIM: IDEA), a leading supplier of regulatory and
compliance software, is pleased to provide an update on trading for
the six months ended 31(st) October 2020 .
Trading Update
The Board is pleased to report that trading for the first half
of the financial year has been ahead of the same period last year
and comfortably in line with the Board's expectations . These
results underpin the Board's confidence in the Group's prospects
for the second half of the financial year and are based upon the
continuing execution of a strategy to grow revenue both organically
and through acquisitions , maintaining high EBITDA margins through
disciplined cost control , generating strong cashflow and
increasing annual recurring revenue (" ARR ") as a percentage of
total revenue.
The Board considers ARR as the Group's primary growth metric and
the driver for long term value. ARR recognised during the first
half is expected to be GBP24.4m (H1 2019: GBP20.3m), representing
83% of total revenues, up from 74% in the comparative prior period.
The ARR book (being contracted revenue to be recognised over the
coming 12 months) has increased by 13% during the first six months
to approximately GBP54. 8m (April 2020: GBP48. 7m ), arising from
both strong organic growth of approximately 7% (14% on an
annualised basis) and 6% of acquired ARR from the acquisition of
Qualsys in August 2020 .
The Group expects to report total revenue up 7% at approximately
GBP29.2m (H1 2019: GBP27.3m ) and adjusted EBITDA* to have
increased by 25% to approximately GBP10.0m (H1 2019: GBP8.0m).
Organic growth was driven by both customer expansion and new
customer logo wins across verticals including Healthcare, Life
Sciences and Financial Services. The Group won 270 new customers in
the period including KPMG, Reata Pharmaceuticals, Bank of Greece,
NATO and the Lighthouse Laboratory and successfully expanding
existing customers such as GSK, Lelam and Discover Financial
Services .
Cash generated by operations during the first six months is
expected to be in excess of 90% of adjusted EBITDA* resulting in a
gross cash balance as at 31 October 2020 of GBP12.1m and gross bank
borrowings of GBP40.0m. Net bank debt at the period end of GBP27.9m
leaves the Group comfortably within banking covenants and on a
robust financial footing.
Directorate Changes
The Group is pleased to announce two changes to bolster the
corporate governance environment and its Board and ensure there is
an appropriate balance of relevant skills, experience and
independence to support the Group and its growth . Following these
changes, the Board comprises 3 Executive and 4 Non-Executive
Directors.
Julian Clough will today join the Board as a Non-Executive
Director and Chairman of the Audit Committee. The current Chairman
of the Audit Committee Alan Carroll remains on the Board and will
continue to chair the Remuneration Committee until his retirement
from the Board in July 2021 following his nine years as an
independent director which is in line with best corporate
governance practice. The Board will start a search process to
replace Alan in the first quarter of 2021.
Julian joins Ideagen following a 40 - year career in accountancy
spanning audit, financial investigation and transaction services.
Most recently Julian served as a Partner at Mazars having
previously served as a Partner at both BDO and RSM Tenon. Julian
qualified as a Chartered Accountant in 1985 with Coopers and
Lybrand (now PwC ) and has advised on over 300 transactions
including Ideagen's AIM flotation in 2012 and the MBO and
subsequent IPO of Games Workshop Group PLC .
Barnaby Kent has today stepped down as a statutory director of
the Company. Barnaby remains Chief Operating Officer and a key
member of our Senior Leadership Team. His primary focus will
continue to be the development of our operating structure and our
people together with ownership of the Group's acquisition
integration process.
Ben Dorks, Chief Executive Officer of Ideagen commented:
"I am pleased to report another excellent start to Ideagen's
financial year. We continue to execute our strategy, delivering
growth both organically and through acquisition , and have invested
in the Group without stretching our disciplined approach to costs.
Our business model has remained resilient throughout the pandemic
with growth being driven from across a number of market
verticals.
Cash generation has been strong which , coupled with further
growth in new SaaS recurring revenues and an increase in repeat
business from our growing customer base , provides a strong
platform for the second half. Given the size and longevity of the
Regulatory and Compliance market and the Group's position as a
leader in the space , the Board is optimistic about the Group's
continued growth prospects .
We are delighted to welcome Julian Clough to the Board. His
appointment brings a seasoned financial expert to the Board and his
blend of transaction and audit experience will be a significant
asset to the Group. I thank Barnaby Kent for his service as a
director and look forward to his ongoing contribution to the
Group's growth ."
*Earnings before interest, tax, depreciation, amortisation,
share based payments, acquisition costs and other exceptional
items.
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) No 596/2014.
Enquiries:
Ideagen plc 01629 699 100
David Hornsby, Executive Chairman
--------------
Ben Dorks, Chief Executive Officer
--------------
Emma Hayes, Chief Financial Officer
--------------
finnCap Limited 020 7220 0500
--------------
Henrik Persson/James Thompson/Kate Washington
(Nomad)
--------------
Alice Lane (ECM)
--------------
Canaccord Genuity Limited 020 7523 8000
--------------
Simon Bridges
--------------
Richard Andrews
--------------
The following disclosures are made in accordance with Schedule
2(g) of the AIM rules
Julian Simon Clough, age 60, has held the following
directorships/partnerships within the last 5 years:
Current Directorships/Partnerships Directorships/Partnerships previously
held in the last 5 years
The S&E Clough 2015 Settlement Mazars LLP
Trust Mazars CARL
--------------------------------------
RSM Tenon PLC entered insolvent liquidation in August 2013. Mr.
Clough resigned from his position as an employee partner of RSM
Tenon in May 2013. At no point during his tenure was he a statutory
director of RSM Tenon plc.
There are no further disclosures to be made in accordance with
Schedule 2(g) of the AIM Rules.
About Ideagen plc
Ideagen is a UK-headquartered, global technology company quoted
on the London Stock Exchange AIM market (Ticker: IDEA.L).
A global supplier of regulatory and compliance solutions,
Ideagen provides a common software platform and an integrated risk-
based approach to meet multi-industry standards, enabling
compliance with relevant laws, policies, and regulations.
The Group provides software and services to organisations
operating within highly regulated industries such as life sciences,
healthcare, banking and finance, insurance, aviation, and aerospace
and defence, with its main operational premises spread throughout
the UK, EU, US, Middle East and SE Asia.
Currently, more than 5,700 organisations use Ideagen's products
including eight of the top 10 UK accounting firms, all of the top
aerospace and defence companies and 75% of the world's leading
pharmaceutical firms. Ideagen's diverse and varied customer base
includes many well-known, global brands such as British Airways,
Aggreko, BAE, Ryanair, US Navy, KLM, BBVA, Bank of New York,
Commerzbank, Meggitt, Heineken, Johnson Matthey, Haeco Group and
European Central Bank. As well as this, Ideagen counts 250
hospitals across the UK and US
amongst its client base. For further information please visit www.ideagen.com .
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END
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