Hamp Wall, Chief Executive Officer, commented: “The Board has dramatically enhanced the scale and financial performance of PROACTIS as well as its medium-term growth opportunity through its successful and focussed M&A strategy. Further, the Group has performed extremely well with a strong momentum in new names signed during the period delivering substantially improved initial contract value. Up-selling and cross-selling activity with existing customers has also been positive. However, this performance is not fully reflected by reported revenue which has been slower to build principally due to a strengthening Sterling which is reducing the impact of the Group’s performance in the United States and in Europe and, latterly, a loss of a number of customers which the Board does not expect to continue.
Following the acquisition of Perfect during August 2017, the Group commenced its restructuring plan. The new leadership team is formed and the Group has been successful in realising an estimated GBP4.2m of annualised cost savings to date. The Board is confident that it will meet its target of GBP5.0m by end of this financial year.
The Group has been introduced to a high level of good quality M&A opportunities and the Board is keen to move forward with this element of the Group’s strategy when it is prudent to do so.
The Group has made substantial progress during the period. The Board is cautious about the immediate outlook for the financial performance of the Group due to the factors described above but is confident about the longer-term growth prospects for value creation. I look forward to the coming period and am confident in our ability to drive further growth and continue to deliver against our ambitious strategy.”
PROACTIS Holdings PLC LON:PHD, a global spend management solution provider, today announced its interim results for the six-month period ended 31 January 2018.
Trading performance
— Deal activity buoyant: 35 new name deals (31 January 2017: 27)
— Favourable revenue shift toward multi-year SaaS deals: 31 new names (31 January 2017: 22)
— Initial contract value signed was GBP4.5m (31 January 2017: GBP1.8m)
— Strong volumes from existing customers: 46 deals in the period (31 January 2017: 59)
Financial performance
— 124% increase in reported revenue to GBP26.4m (31 January 2017: GBP11.8m)
— Underlying revenue growth (excluding the benefit of acquisitions and currency translation related factors) was 3% (31 January 2017: 12%)
— 180% increase in Adjusted EBITDA(1) to GBP8.4m (31 January 2017: GBP3.0m) at a margin of 32% (2017: 25%)
— Adjusted EPS increased 20% to 5.4p (31 January 2017: 4.5p)
— Strong balance sheet with net debt at GBP29.8m (31 July 2017: GBP0.9m)
Revenue visibility
— Order book(2) was GBP47.8m (31 July 2017: GBP28.0m)
— Annualised(3) contracted revenue increased to GBP45.5m (31 July 2017: GBP22.6m)
M&A
— Acquired Perfect Commerce LLC (“Perfect”) for GBP94.3m (net), a complementary provider of spend management systems to buyers and networking services to suppliers
— Post-acquisition performance of Perfect is in line with management’s expectations with five new names being signed, reported revenues for the post acquisition period of GBP13.4m and Adjusted EBITDA of GBP3.7m
— Management estimate net annualised cost synergies made to date of GBP4.2m (31 January 2018: GBP3.2m)
1 – Adjusted EBITDA is stated before non-recurring administrative expenses, amortisation of customer related intangible assets and share based payment charges
2 – Order Book is the Group’s current contracted revenue that is required to be recognised in future accounting periods
3 – Annualised contracted revenue is the Group’s estimate of the annualised value of revenue of customers currently contracted with the Group
