TIDMDOTD
RNS Number : 2984U
dotDigital Group plc
17 January 2017
FOR IMMEDIATE RELEASE 17 JANUARY 2017
dotdigital Group plc
("dotdigital" or the "Company")
Trading Update
and
Notice of Interim Results : 21 February 2017
dotdigital Group plc (AIM: DOTD), the leading provider of
intuitive email and marketing automation software as a service
("SaaS") and managed services to digital marketing professionals,
today gives a trading update ahead of the Company's Interim Results
for the six months ended 31 December 2016. The trading performance
in this statement is based on unaudited initial management
estimates.
H1 2017 highlights:
-- Overall revenue up 17% to approximately GBP15.0m (H1 2016: GBP12.9m);
-- EBITDA in line with market expectations and on track for full year;
-- Monthly recurring revenues from dotmailer's SaaS based usage
up approximately 22% to GBP12.2m (H1 2016: GBP10.0m);
-- Average revenue per client has grown by 24% from GBP525 to GBP650 per month;
-- Total number of emails sent by the dotmailer platform up 41%
to 5.6 billion from 3.9 billion;
-- Strong cash balances at 31 December 2016 of GBP18.9m (H1 2016: GBP14.8m); and
-- Following approval at the AGM on 20 December 2016, a final
dividend of 0.43 pence per ordinary share for the year ended 30
June 2016 plus a special dividend of 0.41 pence per ordinary share,
will be paid on 31 January 2017 to those shareholders on the
register on 13 January 2017.
dotdigital's organic growth strategy is centred around three
core areas:
-- Product innovation;
-- Geographic expansion; and
-- Developing strategic partnerships.
In the six months to 31 December 2016, key performance
highlights against these areas were:
Product innovation
-- Recurring revenue charges from enhanced product functionality
has increased by 71% compared with H1 2016 to annualised revenues
of GBP5.8m;
-- Continued investment in development of existing connectors
and to broaden out both ecommerce and CRM connectors;
-- Shopify connector in Beta testing and will be fully launched February 2017; and
-- Further development and enhancement have been carried out to
our self-service proposition and will be piloted in South Africa
and other selected territories in Q3 2017.
Geographic Expansion
US
-- Revenue from the US region was up approximately 11% to
US$2.3m. Revenue growth in region started off slower than
anticipated but improved in Q2, with the sales pipeline building
following team restructuring, price changes, increasing our
indirect channel network whilst broadening the sales proposition to
include targeting of customers using both Salesforce and Microsoft
Dynamics.
APAC
-- Overall revenue growth within the AsiaPac region increased by
approximately 139% from AUS$0.22m to AUS$0.52m. Further investment
has been made in direct sales, support, account management and
marketing specifically in Australia to increase deal conversion and
client support;
-- More partners were added in the AsiaPac region, with our
first partner signed in Singapore however sales conversion remains
slightly slower than anticipated through the indirect channel as we
continue to build relationships and brand profile; and
-- Overall, whilst AsiaPac is still in its early days of growth,
we are optimistic about the opportunities within this diverse
region and will continue to focus on working with our Magento
customers and CRM integrations.
EMEA
-- Revenue from the EMEA region was up 13% to GBP12.8m from
GBP11.4m, as a result of an increased appetite of our customers to
purchase more product functionality on an incremental basis;
-- Within the UK, we successfully carried out the restructuring
of the direct sales department within the leadership level down to
splitting the sales team to target high value and number of
customers;
-- Price changes in the UK are now more competitive, which has
led to an increased sales pipeline and conversion rates;
-- Account teams now refocused on customer success, leading to
higher levels of customer satisfaction and retention; and
-- Clear and focused strategy implemented on the key target territories within the EMEA market.
Developing Strategic Partnerships
Magento: Continued investment into the development of the
Magento Connector and the partner relationship. The Connector is
now used by over 350 clients generating annualised revenues of more
than GBP5.6m. Though the initial uptake of the Magento Version 2.1
connector was slower than expected a good pipeline has been
building in Q2 with further growth anticipated in the second half
of the year.
PayPal: dotmailer has partnered with PayPal, the world's largest
internet payment provider who has 7 million ecommerce business
users globally. Our integration offers the ability for our
customers to offer one click purchasing in their email campaigns.
This is a unique proposition to the market and is expected to add
value to our mid-market customers. Currently in Beta testing, the
platform is expected be launched in February 2017.
ORO CRM: Strategic partnership signed with ORO CRM, a new US
based global leader in CRM solutions for multi-channel business to
business sector ("B2B"). Currently in Beta testing, the platform is
due to be launched later in 2017.
Milan Patel, CEO of dotdigital, commented:
"I am pleased to report continued strong profitable growth
against contracted recurring revenues up 17% and cash generation
within the business. With the focus on adding value to our
customers we have continued to see the recurring revenues from
advanced functionality increase.
Through the strengthening of our strategic partnership with
Magento we continue to get brand awareness building internationally
which supports the organic growth strategy of the business.
After experiencing a slow start in Q1 in the US we changed
pricing and team structure whilst broadening our sales proposition,
which led to an improved Q2 with a strong pipeline building.
We are excited about putting a direct sales team and support
network in Australia which will act as the hub into broader
AsiaPac. Early signs are promising.
Continuing to build strategic partnerships is key and as we
start to look out into second half of the year, the partnerships we
are building with both PayPal and ORO CRM is also exciting.
The dotmailer platform continues to evolve and innovate,
providing highly sophisticated yet 'easy-to-use' marketing
automation tools for our clients, combined with releasing our
Shopify connector and enhanced self-service offering with a pilot
in South Africa and other selected territories in Q3. This will
lead to a more diversified market proposition for the international
regions.
We look forward to providing a full update on the six months'
trading and continued growth strategy when we report our Interim
Results for the six months ended 31 December 2016 on 21 February
2017."
This Announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014 ("MAR").
For further enquiries please contact:
dotdigital Group Plc Tel: 020 8662 2777
Milan Patel, CEO & CFO
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Financial PR and Investor Tel: 07721 413
Relations 496
Lisa Baderoon
Lisa.Baderoon@dotmailer.com
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N+1 Singer (Nominated Tel: 020 7496 3000
Adviser and Joint Broker)
Shaun Dobson, Head of
Corporate Finance
Liz Yong, Corporate Finance
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finnCap (Joint Broker) Tel: 020 7220 0500
Stuart Andrews, Corporate
Finance
Rhys Williams, Sales
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This information is provided by RNS
The company news service from the London Stock Exchange
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