Tax Systems plc (LON: TAX), a leading supplier of corporation tax software and services, is pleased to provide an update on trading for the year ended 31 December 2018.
Following on from the strong performance reported at the time of the interim results in September 2018, the Group has continued to grow both recurring and non-recurring revenue from existing and new customers. As a result, the Board expects to report results for the year ended 31 December 2018 comfortably in line with management’s expectations.
The Group’s income continues to be derived substantially from recurring revenues, with existing customers consistently choosing to renew and extend their contracts as well as upgrading to access additional modules. In addition, Tax Systems secured in excess of 50 new customer accounts during the financial year. This high quality of earnings, alongside strong cash flow, has underpinned the Group’s ability to decrease its net debt1 by 32% to £13.9m at 31 December 2018 (31 December 2017: £20.5m; 30 June 2018: £17.5m).
The full results for the year ended 31 December 2018 are expected to be announced in April 2019 and the Board looks forward to updating shareholders with further details at that time.
Gavin Lyons, CEO of Tax Systems, commented,
“We have made strong progress during the year and I am incredibly grateful to everyone in the business for their expertise and commitment to our customers. As a team, we remain focused on the execution of our growth strategy and I’m pleased to report that we expect to be comfortably in line with management’s expectations, with the standout financial highlight being a 32% reduction in net debt.
“Tax Systems has a market leading position, a high-quality customer base and first class technology. We continue to be focused on servicing the needs of our existing clients and creating new solutions to help organisations with the Government’s Making Tax Digital initiative, which begins to be rolled out from April 2019. As a result, the Company remains in a good position to drive further growth in 2019.”
1Net debt is defined as bank borrowings and loan notes recognised as liabilities and the equity element of the loan notes recognised in equity less cash
As of 24th May 2018, MXC Capital Ltd (LON:MXCP) holds a 4.0% share in Tax Systems Plc.
MXC is an AIM quoted (LON: MXCP) adviser to and investor in technology companies, building value in the companies we invest in as well as for our own shareholders. MXC’s model of investing as a principal, sharing in the risk as well as the reward, unambiguously aligns our management directly with the interests of our shareholders.
