TIDMNWT
RNS Number : 6278Z
Newmark Security PLC
17 May 2023
This announcement contains inside information for the purposes
of Regulation 11 of the Market Abuse (amendment) (EU Exit)
Regulations 2019/310.
Newmark Security plc
("Newmark", the "Company" or the "Group")
Year-end trading update
Continued revenue growth and a return to profitability
Newmark Security plc (AIM: NWT), a leading provider of
electronic, software and physical security systems, today provides
an update on trading for the year ended 30 April 2023 ("FY23"),
reaffirming the Company's return to profitability.
Highlights
-- FY23 year-on-year revenue growth, driven by a strong
performance in the People, Data Management, and Physical Security
divisions.
-- Product innovation and efficient software systems have
enhanced solutions offering, driving new client contracts.
-- Human Capital Management ("HCM") annualised recurring
revenues* ("ARR") increased by 133% year-on-year to GBP2.1 million
for April 2023, positively contributing to profit margins.
-- Confirmation of a return to profitability and cash flow generation in FY23.
-- Continued focus to invest in people and infrastructure to fuel sustainable growth.
*ARR is calculated by annualising revenue recognised in a given
month from all clients on deployed HCM subscription contracts.
Operations
People and Data Management division - Grosvenor Technology
("Grosvenor")
Ongoing product development in cloud-based SaaS solutions and
enhanced software applications on Time Clocks and now Bring Your
Own Device ("BYOD") tablet devices has extended the reach of the
Group's solutions in HCM and, therefore, the overall share of
wallet. Following the increasing momentum in public and private
sector spaces, Access Control has performed well year-on-year.
Compliance with data remains a strong underpinning core value,
and the business continues to leverage this in winning new HCM SaaS
recurring revenue business in both the North American and European
markets. This has resulted in a 133% increase in the HCM ARR to
GBP2.1 million for April 2023 (April 2022: GBP0.9 million).
During the period, Grosvenor's US headquarters were relocated to
a much larger facility in Florida, and third-party logistics were
bought in-house, further improving the ability to serve
customers.
Physical Security Solutions division - Safetell
The organisational changes have been successfully implemented
within Safetell following the restructuring of sales and marketing
in 2022. This restructuring has helped Safetell deliver FY23
revenue growth, primarily from retail screens, entrance control
installations and automatic door services.
During the year, Safetell developed a redesigned, cost-effective
retail attack-resistant screen for convenience stores, and this has
been subject to strong demand, having rolled out over GBP1 million
of installations for major UK retailers and built a pipeline of
over GBP2 million for installations for FY24.
Safetell has continued to increase its market share in the
Entrance Control market with successful installations direct to end
users and within the enlarged construction sector, including
newbuild and refurbishment. The Group's market share has continued
to grow in Automatic Doors Services, with new national service
contracts increasing recurring revenues.
Financial Position
The Group's cash at 30 April 2023 was GBP0.6 million (30 April
2022 cash: GBP0.2 million). This increase was due to a significant
improvement in operation cashflows driven by higher revenues,
increased gross margin percentage and lower overheads.
Supply chain challenges have been successfully managed by
building inventory to satisfy ongoing customer demand. The
inventory levels are expected to ease in FY24, allowing for further
cash flow generation.
In January 2023, the Group's UK invoice financing facility was
increased by GBP0.5 million to GBP2.3 million to provide further
working capital headroom as the Group continues to grow.
Maurice Dwek, Chairman of Newmark, commented:
"We are pleased to report that the business has returned to
full-year profitability. This is the result of the hard work that
commenced in the previous financial year, which has seen us
optimise our operations, put through necessary price increases to
mitigate the inflationary environment and enhance our product
offering to meet the needs of our customers. Overall, Newmark is a
much stronger business with a platform to drive future growth.
"Looking ahead, the business has made a good start to FY24 with
its new revenue pipeline. Whilst the Board cautiously observes
current macro events, it remains confident in Newmark's product and
service offering. The Company looks forward to updating the market
on further commercial progress in due course."
Newmark Security plc Tel: +44 (0) 20 7355 0070
Marie-Claire Dwek, Chief Executive www.newmarksecurity.com
Officer
Paul Campbell-White, Chief Financial
Officer
Allenby Capital Limited Tel: +44 (0) 20 3328 5656
(Nominated Adviser and Broker)
James Reeve (Corporate Finance)
Amrit Nahal, Tony Quirke (Sales
& Broking)
Yellow Jersey PR Limited Tel: +44 (0) 203 2004 9512
(PR & IR)
Charles Goodwin / Dominic Barretto
About Newmark Security plc
Newmark is a leading provider of electronic, software and
physical security systems that helps organisations protect human
capital and provide safe spaces seamlessly and securely.
From our locations in the UK and US, we operate through
subsidiary businesses positioned in specialist, high-growth
markets.
We foster an open and inclusive work environment amongst our
c.100 employees, serving hundreds of blue-chip customers.
Our product portfolio consists of Human Capital Management and
Access Control Systems providing both hardware and software and
Physical security installations to various sectors.
Newmark Security plc is admitted to trading on AIM
(AIM:NWT).
For more information, please visit: www.newmarksecurity.com
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END
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