PROACTIS Holdings PLC Trading Update and Notice of Results (4922Y)
August 22 2018 - 1:00AM
UK Regulatory
TIDMPHD
RNS Number : 4922Y
PROACTIS Holdings PLC
22 August 2018
Date: 22 August 2018
On behalf of: Proactis Holdings PLC ("Proactis", the "Company"
or the "Group")
Embargoed until: 0700hrs
Proactis Holdings PLC
Trading Update & Notice of Results
Proactis Holdings PLC, the global spend management and B2B
eCommerce solution provider, reports a detailed update on trading
for the financial year ended 31 July 2018 further to its initial
update on 7 August 2018.
Trading Update
The Group has created a platform which is capable of delivering
sustainable organic growth having undertaken a transformational
re-organisation of its operational structure. This re-organisation
has delivered net annualised cost savings of approximately GBP5.0m
at 31 July 2018 and were anticipated at the time of the acquisition
of Perfect Commerce, LLC on 4 August 2017 (the "Acquisition").
The Acquisition created the fifth largest player in the market
by revenue, globally and it accelerated Proactis' strategy to drive
scale, geographic footprint, customer opportunity, operational
efficiencies and a stronger solution set into its business.
Deal intake for the year was strong. Proactis secured 64 new
names with a total initial contract value of GBP8.7m (2017: 54;
GBP4.1m) and 120 upsell deals with a total contract value of
GBP3.6m (2017: 110; GBP2.8m). 55 of the 64 new names (2017: 44 of
the 54) were subscription deals with the remainder being perpetual
licence deals. This performance was at the Board's expected levels
across all territories.
The Group re-iterates its expectation that it will report
revenue(1) of approximately GBP52.0m (2017: GBP25.4m), Adjusted
EBITDA(1) of approximately GBP17.0m (2017: GBP7.9m) and Adjusted
profit before tax(1) of GBP11.0m (2017: GBP5.1m). Given that
revenue(1) of GBP26.4m as reported in the interim results to 31
January 2018 announced on 24 April 2018 ("Interim Results")
included approximately GBP1.0m which was non-continuing as a result
of the loss of a small number of customers and also that it
included the benefit of stronger US Dollar and Euro currencies,
this suggests that the Group's revenue for H2 2018 was marginally
ahead of underlying revenue(1) for H1 2018. The Group will present
a segmental analysis of its performance within its preliminary
results which will include, but is not limited to, revenue analysis
by territory and buyer/supplier split.
The Group's customer retention performance has improved in H2
2018 following the exceptional losses reported in the Interim
Results and advanced notifications of termination are now running
at levels which the Board considers to be more normal. The Board
continues to monitor this key performance indicator carefully and
is making further operational changes to support this element of
the Group's activities with a view to improving overall performance
further.
The above factors provide the Board with confidence that the
Group will return to normal, stronger rates of revenue growth
during the year ending 31 July 2019 and the pipeline of opportunity
remains strong for the longer term.
Net debt(2) as at 31 July 2018 is expected to be approximately
GBP29.3m.
(1) Revenue, Adjusted EBITDA and Adjusted profit before tax are
unaudited and Adjusted EBITDA is stated before the Company's
assessment of non-recurring administrative expenses, amortisation
of customer related intangible assets and share based payment
charges.
(2) Net debt is unaudited and is calculated excluding the $5
million 2.0 per cent. convertible unsecured loan notes due 2022 and
convertible at GBP1.65 per share. These loan notes were issued as
part consideration in connection with the acquisition of Perfect
Commerce, LLC on 4 August 2017 and are expected to be converted to
equity.
This report does not include any contribution from or impact of
the acquisition of Esize Holdings BV ("Esize") which was described
within the Group's announcement on 7 August 2018.
Notice of Results
The Group intends to release its preliminary results for the
financial year ending 31 July 2018 on 30 October 2018.
Hamp Wall, CEO of Proactis commented:
"I am encouraged by the progress made and expected out turn for
the year which, although reduced from what I had anticipated coming
into the new Group, signifies a very substantial business with
excellent potential. Proactis has a strong position across all key
territories and is well positioned in a growing marketplace.
"Our acquisition of Perfect Commerce has enabled us to create a
platform that can deliver sustainable organic growth and our
organisational structure is now set for the Group to realise the
opportunities that we set out at the start of the business
combination process and which remain substantial.
"Our new business performance is as strong as we had planned for
and our retention performance is recovering after a disappointing
period. The new name and upsell performance was strong in both
volume and value and this gives me confidence that we will see a
return to sustainable organic growth and strong cash generation
with a significant opportunity for enhancement in North West Europe
following our acquisition of Esize."
This announcement contains inside information for the purposes
of article 7 of Regulation 596/2014
For further information, please contact:
Proactis Holdings PLC
Hamp Wall, Chief Executive Officer Via Redleaf Communications
Tim Sykes, Chief Financial Officer
Redleaf Communications
Elisabeth Cowell
Bob Huxford
Fiona Norman 020 3757 6880
finnCap Limited
Corporate Finance
Stuart Andrews
Carl Holmes
Emily Watts 0207 220 0500
Notes to Editors:
Proactis creates, sells and maintains software and services
which enable organisations to streamline, control and monitor all
indirect expenditure. Its solutions are used in approximately 1,000
buying organisations around the world from the commercial, public
and not-for-profit sectors.
Proactis is head quartered in London and floated on the AIM
market of the London Stock Exchange in June 2006.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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