Barrie Whipp, Executive Chairman of Crimson Tide, commented: “The Directors are very encouraged by our growth and believe that we should continue to pursue aggressively the opportunities we have developed. The Board has targeted growth at the top-line level while continuing to plough a proportion of profits back into the business. Our IOT module, combined with our geographic expansion, offers tremendous upside. We are also seeing traction in Northern Europe and the Middle East and I am confident that these opportunities will increase this year with both existing and new clients. The Directors are very optimistic for the future.”
Crimson Tide LON:TIDE, the provider of mpro5 Smart Mobility as a Service, is pleased to provide this trading update for the year ended 31 December 2017, and to bring the market up to date on its plans for continued expansion.
Financial
The Company had a very positive year in 2017. Revenue for the year ended December 31, 2017 is expected to total GBP2.3 million, an increase of approximately 23% on the previous year.
The Board’s strategy is one of continued investment in the growth of the business and in particular the sales and marketing resources to ensure the Company is positioned to take full advantage of the opportunities that are emerging. Company headcount has doubled over 18 months, to address growth in demand for our products. Nothwithstanding the increased cost associated with this, profit before tax for 2017 is still expected to be similar to 2016 and has been achieved as a result of both revenue growth and increased gross margin.
Cash generation from organic business continues to be strong, and balances have been maintained notwithstanding a reduction of some GBP250k in debt on finance leases and funding investments in the Middle East, Northern Europe and the USA. The Company has no core debt and has approximately GBP750k in cash.
Strategy and Outlook for 2018
From a strategic standpoint, the Company is launching its mpro5 Internet of Things (IOT) service during the current quarter. The Directors believe there is a clear opportunity to supply this new, sensor-based mpro5 module to existing, long-term, contracted clients. The market for cloud, mobility and IOT is undoubted and mpro5 provides clients with a fully inclusive service on a long-term, contracted, subscription basis.
In healthcare, the Company is making its first inroads into the NHS, where there is enormous scope for mpro5 to assist in areas from facilities management to patient care. The Company is recruiting a government-sector sales executive to pursue this opportunity as well as securing additional sales resources in the North of the UK and in Ireland.
The Directors believe that demand for mpro5 is stronger than at any previous time, as demonstrated by the number of opportunities in the pipeline, and that to maximise the benefits of this positive position, the Company should continue to invest in sales and marketing in 2018. It is anticipated that the percentage growth in topline revenue will be similar in 2018, then rise in the following two years. The Company strategy is to continue to expand in 2018 in order to facilitate the growth in the business and re-invest the increased cash generation into a larger operation whilst maintaining profit before tax at current levels in 2018.
