TIDMBLUR
RNS Number : 1920O
Blur Group PLC
03 November 2016
blur Group plc
("blur Group", the "Group" or the "Company")
Q3 2016 Quarterly Business Update
blur Group plc (AIM:BLUR), the market-leading Indirect Spend
Platform & Marketplace, today releases key metrics for Q3 2016,
a period where the addition of goods to blur's offering has created
a solution that eliminates waste in Enterprises across all indirect
spend categories.
Q3 2016 highlights:
-- Successful addition to blur's online Marketplace allowing
organisations to source goods alongside business services for the
first time
-- Enterprise-focussed strategy continues to drive improvements
to EBITDA, costs and cash burn
-- New pilot initiated with global electronics/technology company, during the quarter
-- Fourth consecutive quarter of improved underlying cash burn -
down by 11% to $1.0 million in Q3 2016, from $1.1 million in Q2
2016 (excluding Foreign Exchange movements). In addition, $0.4
million relating to R&D tax credit was received in the quarter
yielding net cash burn of $0.6 million.
-- Cash at the end of Q3 2016, including $0.9 million unrealised
foreign exchange movements, was $3.6 million
-- Operating costs down 23% compared to Q2 2016. Down by 74% compared to Q3 2015
-- Reduction in project numbers in Q3 due to summer seasonality,
exaggerated by delayed decision-making following the outcome of the
'Brexit' referendum. Non-Enterprise project volumes remained
stable
-- EBITDA continues to be in line with management expectations
ALL PROJECTS Q3 Q2 CHANGE
2016 2016
--------------- ------- ------- --------
No. No. %
--------------- ------- ------- --------
Pitching On 57 73 -21.9
--------------- ------- ------- --------
Kicked Off 44 73 -39.7
--------------- ------- ------- --------
Completed 46 54 -14.8
--------------- ------- ------- --------
ENTERPRISE PROJECTS Q3 Q2 CHANGE
ONLY** 2016 2016
---------------------- ------- ------- --------
No. No. %
---------------------- ------- ------- --------
Pitching On 8 30 -73.3
---------------------- ------- ------- --------
Kicked Off 2 30 -93.3
---------------------- ------- ------- --------
Completed 6 38 -84.2
---------------------- ------- ------- --------
**blur defines the Enterprise as a business with 50 or more
employees
During Q3 2016, the Group saw a reduction in overall project
volumes due to summer seasonality, exaggerated by delayed
decision-making following the outcome of the 'Brexit' referendum.
Non-Enterprise project volumes grew for both Pitching On and
Completed projects, while non-Enterprise Kicked Off projects
remained broadly constant, compared to Q2.
Enterprise sales cycles are developing, as Enterprise better
understand how to adopt blur's platform with one new Enterprise
pilot starting in Q3. In addition, blur continued to deepen
relationships with key Enterprise customers including:
UK listed enterprise, aerospace engineering; blur continues to
work with this large corporation on a pilot program that is now
planned to start in Q4 2016/Q1 2017. blur's expanded offering,
including goods, means that the Company can now address all
categories of indirect spend using the Marketplace. The roadmap
with this customer conforms to the Group's expectation of long
sales cycles when working with Enterprise clients.
Global enterprise, sportswear retailer; blur is working with a
corporation on an initial pilot due to start in 2017. Initially
operating in one trial geography, blur is seeking to complete a
pilot phase which, if successful, could lead to a wider, global
rollout.
Global enterprise, electronics/technology; following a long
initial sales process, blur has commenced initial pilot activities
with this international corporation.
Pilot programs are continuing with the multi-platform media and
oil and gas listed Enterprises highlighted in the Q2 2016 metrics
update.
Financial update
blur's focus on larger, Enterprise accounts continues to drive
sequential improvements to EBITDA, costs and cash for the fourth
consecutive quarter.
The Group's cash balance at the end of Q3 2016 totalled $3.6
million compared to $4.3 million at the end of Q3 2016. During Q3,
blur received an R&D tax credit in respect of 2015 totalling
$0.4 million.
blur's reported cash balance has been impacted by $0.9 million
of unrealised exchange losses in 2016 to date and $0.1 million of
unrealised exchange losses in Q3 2016, as the valuation of blur's
sterling denominated cash balances were further affected by the
decline in the GBP:USD exchange rate.
Excluding the unrealised exchange losses cash, which is
predominately held in GBP, would be valued at $4.5 million at the
end of Q3.
Excluding these exchange movements, and Q3's R&D tax credit
receipt of $0.4 million, the cash burn for the quarter was $1.0
million.
blur's operating efficiency also continued to improve, driven by
further process improvements in the blur 6.0 platform. These
resulted in a reduction in operating expenses of 23% in Q3,
compared to Q2 2016 and by 74% compared to Q3 2015.
Philip Letts, blur Group CEO, commented:
"Q3 2016 has seen the Group announce a major addition to its
online marketplace, allowing blur's customers to source goods
alongside business services for the first time.
"This expansion is the next step in blur's evolution and a key
pillar of the blur 6.0 development roadmap. It reflects our
increased perception of market readiness to adopt blur's online
marketplace as a strategic platform for all categories of indirect
spend, not only business services.
"Sales cycles continue to be elongated. However, we are
experiencing deeper engagement with blur's Enterprise customers,
whose focus is now firmly on cost control and cash optimisation.
These organisations are working with blur to better understand
their indirect spend and to identify the many areas where they can
partner with blur. We continue to prove that adoption of blur's
solution can crystallise savings of between 10% & 30% for the
typical large corporate.
"As we seek to capitalise on this increasing Enterprise market
readiness, I'm delighted to announce that Laurence Cook has joined
blur's management team from 1 November 2016, as Chief Commercial
Officer with responsibility for Enterprise platform sales.
"Laurence brings a wealth of experience selling Enterprise
Software solutions including partnering closely with the BBC, while
working at Siemens IT Outsourcing Solutions and as well as stints
at Energis, Mastek and Sopra Steria. Laurence's deep understanding
of the Enterprise software market combined with the opportunity
presented by blur's innovative indirect spend solution will enable
the Group to press ahead with its plans to achieve multi-million
dollar roll outs of our platform in larger organisations.
"At the same time, the Group also remains focussed on its cash
and costs. That focus, together with our Enterprise strategy,
delivered the fourth consecutive quarter of EBITDA, cost and cash
burn improvement.
"Our continuing commitment to cost and cash control, combined
with wider roll outs of blur's solutions within repeating
Enterprise customer accounts both remain key to blur's path to
sustainable profitability."
This announcement contains inside information.
For further information, please contact:
blur Group plc investors@blurgroup.com
Tim Allen Tel: +44 (0) 1392 927618
Shaun Dobson/Jen Boorer N+1 Singer
Tel: +44 (0) 20 7496 3000
Alistair de Kare-Silver Yellow Jersey PR
Tel: +44 (0) 7825 916715
About blur Group plc at blurgroup.com
Since 2010, blur Group has been helping enterprises worldwide
eliminate waste and inefficiency in their indirect procurement
process through its market leading Indirect Spend Platform &
Marketplace. To date over 65,000 businesses, including companies
like, Tesco, Danone, Trinity Mirror, and PwC, have adopted blur's
platform to either buy or sell goods and services online submitting
over $500m of requirements to blur Group's platform.
blur Group is a public company listed on the London Stock
Exchange's AIM market (BLUR) and is headquartered in the UK with
regional sales offices in the US and Europe.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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