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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Ideagen Plc | LSE:IDEA | London | Ordinary Share | GB00B0CM0C50 | ORD 1P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 349.00 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
TIDMIDEA
RNS Number : 9438M
Ideagen PLC
26 January 2016
26 January 2016
Ideagen PLC
("Ideagen" or the "Group")
Unaudited Interim Results for the six months ended 31 October 2015
Ideagen PLC (AIM: IDEA), a leading supplier of Information Management software to highly regulated industries, announces its unaudited interim results for the six months ended 31 October 2015.
Financial Highlights
-- Revenue increased by 75% to GBP9.87m (2014: GBP5.65m)
o Underlying organic growth of 6%
o Recurring revenues represent 53% (2014: 53%) of overall revenues and cover 87% (2014: 86%) of fixed operating overheads
-- Adjusted diluted EPS** increased by 16% to 0.98p (2014: 0.84p) -- Adjusted EBITDA* increased by 65% to GBP2.41m (2014: GBP1.46m) -- Adjusted PBT** increased by 65% to GBP2.13m (2014: GBP1.29m) -- Cash generated by operations of GBP1.15m (2014: GBP0.48m) -- Net cash of GBP5.44m (30 April 2015: GBP5.27m; 31 October 2014: GBP2.81m) -- 11% increase in interim dividend to 0.061p (2014: 0.055p)
*Before share based payments and exceptional items
**Before share based payments, amortisation of acquisition intangibles and exceptional items
Operational Highlights
-- Significant progress within cloud business
o Release of new functionality within the Enlighten product, Ideagen's cloud based GRC solution
o 4 new Enlighten customer wins
o Industry recognition for Enlighten with GRC 20/20 Award for technical innovation
o Post period end granted a GBP4.9m Award Decision Notice for Enlighten
-- Over 50 new on premise customer wins including Schiphol Airport, Kyocera and Fokker -- Strong customer retention - 97% maintenance and support contract renewal rate -- Significant contract extensions from existing customers including PWC, BBVA and Meggitt
David Hornsby, CEO of Ideagen, commented: "We are pleased with the strong first half performance, characterised by further profitable growth as a result of new customer wins and expanding our footprint within our existing base of over 2,200 customers. We have been delighted by the early customer interest and industry recognition for our recently launched cloud-based product, Enlighten, which we see as a significant opportunity for the Group.
"Trading remains robust across all GRC product areas and we have continued our sales momentum through the third quarter. Therefore, given the performance of the Group in the year to date, the growing contracted recurring revenue base, and healthy pipeline of new sales opportunities, the Board is confident in the outlook for the year as a whole."
Enquiries:
Ideagen plc 01629 699100 David Hornsby, Chief Executive Graeme Spenceley, Finance Director finnCap Limited 020 7220 0500 Stuart Andrews/James Thompson (Nomad) Stephen Norcross (Corporate Broking) Alma PR 020 8004 4218 Josh Royston Hilary Buchanan
About Ideagen plc
Ideagen is a UK company quoted on the London Stock Exchange AIM market (Ticker: IDEA.L). Ideagen is a supplier of Information Management software with operations in the UK, the United States and the Middle East. The Company specialises in eGRC (Enterprise Governance, Risk and Compliance) and Content and Clinical solutions with a primary focus on organisations operating within highly regulated industries. With an excellent portfolio of software products, Ideagen is able to provide complete information lifecycle solutions that enable organisations to reduce risk, meet their regulatory and compliance standards, helping them to reduce costs and improve efficiency.
The Group has a customer base of over 2,200 organisations using the Ideagen suite of products, including many blue chip names such as BAE Systems, Emirates, Shell and the European Central Bank as well as 150 hospitals in the UK and US.
For further information please visit www.ideagen.com
CHIEF EXECUTIVE'S REVIEW
Business Review
This has been another period of solid growth for the Group, with underlying organic growth of 6%. Organic growth has been augmented by the contribution of the integrated Gael and EIBS businesses, resulting in overall Group revenue growth of 75%, adjusted EBITDA growth of 65% and adjusted diluted EPS growth of 16%.
The Group's core expertise is in the development and implementation of Governance, Risk and Compliance (GRC) software tools that enable customers to identify, assess and prioritise risk and to manage information in line with rigorous regulations. In each of our chosen verticals, our customers are increasingly required to take a holistic view of risk management, internal audit and compliance, with many organisations at the beginning of the adoption phase of sophisticated, enterprise-wide solutions.
Demand in all of the Group's key GRC verticals continue to be robust, with new customer wins achieved across a range of industries. Growth in the period has been driven by a combination of new customer wins and expanding our footprint within the existing customer base of more than 2,200 organisations. New wins include Schiphol Airport, HNZ Global, Fokker, Providence Healthcare, Edmundson Electrical and Kyocera. Significant orders from the existing customer base include PWC, BBVA, Meggitt and BTG.
The Group continues to benefit from a strong base of recurring revenues, which now represent 53% of revenue (2014: 53%), covering 87% of the fixed overhead base (2014: 86%). Additionally 24% of revenue was derived from additional licence and service sales to existing customers. Therefore 77% of revenue is either recurring or repeatable in nature providing strong visibility over future earnings. In the period, 23% of revenue was derived from brand new customer wins.
During the period we have been pleased with the success of our recently launched SaaS-based Enlighten platform. Post period end the Group announced an Award Decision Notice from a Public Sector organisation stating its intent to procure Enlighten in a contract that is expected to be worth GBP4.9m over 5 years. As previously announced, the formal procurement process was subject to a mandatory standstill period. The standstill period has now ended and the contract is expected to be executed in the near future. As rapid delivery of the solution is essential to the customer, the Group, as an interim measure, has agreed to work under a short term contract to expedite immediate initiation whilst the 5 year contract is finalised. The programme is therefore well underway and the Group expects to generate significant revenues from the customer this financial year.
While the contribution of cloud based SaaS revenue to total Group revenue is currently modest, we are confident that Enlighten will be profitable and cash generative in the Group's 2016-2017 financial year. The Group has continued to invest in the required product development and sales resources and we view this as an area of significant potential growth for the business.
Markets: GRC and Content & Clinical
The Group operates in two areas: supplying GRC solutions to highly regulated industries including Healthcare, Complex Manufacturing, Finance and Transport; and, through leveraging our core technology, we operate a parallel business in the supply of Content and Clinical management solutions, predominately to the NHS. The Group has established a broad customer base across both markets, including 7 of the top 10 UK accounting firms; 125 of the 165 English NHS Acute Trusts; all 7 of the top 7 Global Aerospace & Defence companies; and 14 of the 14 Scottish Regional Health Boards.
GRC represents the greatest part of Ideagen revenues (c. 77%) and the Group believes will continue to be the core driver of overall growth. The market remains highly fragmented - there is no one dominant supplier but rather numerous smaller vendors providing niche product sets. We believe that, with our broad product portfolio and best of breed capabilities, the Group has realised only a small proportion of the available opportunity to date.
23% of Group revenue is derived from our Content and Clinical solutions. This area of the Group's operations continue to be impacted by delays in decision making within acute NHS trusts, typically around enterprise patient information opportunities. This is due to budgetary constraints at acute trust level as no additional technology fund has been made available for the current financial year to support the Government Paperless NHS strategy. However, outlook for the business remains encouraging over the medium term as it is likely that the central technology fund will be reintroduced in 2016-2017, following which there will be a locally funded Sustainability and Transformation Plan (STP) which will focus on digital initiatives at acute trust level.
Acquisitions
As previously announced, the integration of EIBS and Gael has provided a robust business platform. The Board continues to pursue acquisition opportunities in line with its stated strategy of acquiring complementary businesses that have strong IP and significant recurring revenues.
Product Strategy
"On Premise"
The focus for on premise product development going forward will be the closer integration of the established product set. The demand from customers continues to evolve toward the need for robust operational risk management across the enterprise combining the need for big data analysis with the escalation of information available within a corporate environment. We believe the optimum way to achieve this is through the implementation of a single, modular platform.
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As such, our efforts will be on the closer integration of our best-in-breed product set to unify all product components (development standards, installation method, user interface) into a single standard format, and to enable product interoperability - or the exchange of data across each product - through a common service bus. This will allow us to rationalise the product set to avoid any duplicate functionality whilst providing a modular platform.
The ability to deliver this comprehensive capability through a modular portal will enable us to continue to pursue a 'land and expand' growth strategy as well as move into complementary industry verticals.
"Cloud"
To ensure that the Group is able to take advantage of the growing demand for cloud based solutions we have continued to invest in Enlighten, a risk-based, ultra-modern GRC software product. Enlighten has been designed for large enterprise and built for the cloud using Amazon Web Services (AWS). It contains all the rich features that any large, highly regulated organisation needs to achieve exceptional performance while managing compliance, quality and safety.
Enlighten is suitable for large enterprises who have a dispersed workforce, require rapid deployment and fast access to a GRC platform often through a mobile device. For example the large Public Sector customer referred to earlier intends to make Enlighten available to over 70,000 users to allow real time reporting of incidents to drive safety across an entire industry.
We were also delighted that during the period, Enlighten was recognised for its technical innovation by the 4(th) Annual GRC 20/20 Awards. The GRC 20/20 Awards recognise the leading GRC (Governance, Risk and Compliance) software products on the market. GRC 20/20 named Ideagen's Enlighten product as the most innovative product in its Environmental Health & Safety category. Judges were impressed with Enlighten's scalability, user experience, analytics and mobile capability.
Current Trading & Outlook
Trading remains robust across all GRC product areas and we have continued our sales momentum through the third quarter. Therefore, given the performance of the Group in the year to date, the growing contracted recurring revenue base, and healthy pipeline of new sales opportunities, the Board is confident in the outlook for the year as a whole.
David Hornsby
Chief Executive Officer
FINANCIAL REVIEW
Revenue for the 6 months ended 31 October 2015 increased by 75% to GBP9.87m (2014: GBP5.65 m). Organic growth in revenue was 6% based on a comparison of revenue in the period under review with pro-forma revenue for the comparative period adjusted for the Gael and EIBS acquisitions. Recurring revenues represent 53% (2014: 53%) of overall revenues and cover 87% (2014: 86%) of fixed operating overheads.
Adjusted EBITDA increased by 65% to GBP2.41m (2014: GBP1.46m). Amortisation of acquired intangibles of GBP1.86m (2014: GBP0.86m) represents the majority of the total depreciation and amortisation charge. The increase in the period is mainly attributable to the acquisition of Gael in January 2015.
The adjusted group tax charge was GBP0.31 million (2014: GBP0.20 million). This has been adjusted to exclude the deferred taxation associated with the amortisation of acquired intangibles and share based payment charges. The adjusted group tax charge represents 15% (2014: 16%) of adjusted PBT of GBP2.13m (2014: GBP1.29 million). The Group continues to benefit from the availability of R&D taxation credits.
As a result of the above, adjusted diluted earnings per share increased by 16% to 0.98p (2014: 0.84p).
The Group's financial position has continued to strengthen with net assets increasing to GBP31.8m (30 April 2015: GBP31.2m; 31 October 2014: GBP14.0m). The significant increase on 2014 was largely due to the GBP17.5 million share placing to support the acquisition of Gael. Net current assets increased to GBP2.69m (30 April 2015: GBP1.23m; 31 October 2014: GBP1.79m).
Cash generated by operations amounted to GBP1.15m (2014: GBP0.48m) representing 48% (2014: 33%) of adjusted EBITDA. Cash generated by operations is normally lower in the first half of the year partly due to the payment of a number of larger annual overheads in this period. Trade and other payables reduced by GBP1.16m in the six months to 31 October 2015. The Group ended the period with cash balances of GBP5.44m (30 April 2015: GBP 5.27m; 31 October 2014: GBP2.81m) and no debt.
At 31 October 2015 deferred consideration of GBP3.2m was payable in respect of the acquisition of Gael of which GBP1.6m has subsequently been paid in January 2016 and GBP1.6m is payable in January 2017.
Dividend
The Board proposes increasing the interim dividend by 11% to 0.061 pence per share (2014: 0.055 pence per share) payable on 10 March 2016 to shareholders on the register on 19 February 2016. The corresponding ex-dividend date is 18 February 2016.
Graeme Spenceley
Finance Director
Ideagen plc
Consolidated Statement of Comprehensive Income for the six months ended 31 October 2015
Six months Six months ended ended 31 October 31 October 2015 2014 GBP'000 GBP'000 Revenue 9,867 5,653 Cost of sales (1,206) (949) Gross profit 8,661 4,704 Operating costs (6,254) (3,247) ----------- ----------- Profit from operating activities before depreciation, amortisation, share-based payment charges and exceptional items 2,407 1,457 Depreciation and amortisation (2,141) (847) Share-based payment charges (384) (85) Costs of acquiring businesses - (74) ----------- ----------- (Loss) / profit from operating activities (118) 451 Finance income 3 2 ----------- ----------- (Loss) / profit before taxation (115) 453 Taxation credit / (charge) 121 (75) ----------- ----------- Profit for the period 6 378 Other comprehensive income Exchange differences on translating foreign operations (10) 13 Total comprehensive income for the period attributable to the owners of the parent company (4) 391 =========== =========== Earnings per share Pence Pence Basic 0.00 0.31 Diluted 0.00 0.29
Ideagen plc
Consolidated Statement of Financial Position at 31 October 2015
31 October 30 April 31 October 2015 2015 2014 GBP'000 GBP'000 GBP'000 Assets and liabilities Non-current assets Intangible assets 33,891 35,050 13,419 Property, plant and equipment 339 302 202 Deferred income tax assets 962 876 171 ----------- --------- ----------- 35,192 36,228 13,972 ----------- --------- ----------- Current assets Inventories 55 55 96 Trade and other receivables 7,312 7,332 4,024 Cash and cash equivalents 5,442 5,266 2,806 ----------- --------- ----------- 12,809 12,653 6,926 ----------- --------- ----------- Current liabilities Trade and other payables 2,206 3,476 1,623 Contingent consideration on business combinations 47 47 327 Current income tax liabilities 129 44 492 Deferred revenue 6,108 6,228 2,697 Deferred consideration on business combinations 1,628 1,628 - ----------- --------- ----------- 10,118 11,423 5,139 ----------- --------- ----------- Non-current liabilities Deferred consideration on business combinations 1,613 1,613 - Deferred income tax liabilities 4,434 4,656 1,611 ----------- --------- ----------- 6,047 6,269 1,611 ----------- --------- ----------- Net assets 31,836 31,189 13,968 =========== ========= ===========
Ideagen plc
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Consolidated Statement of Financial Position at 31 October 2015 (continued)
31 October 30 April 31 October 2015 2015 2014 GBP'000 GBP'000 GBP'000 Equity Issued share capital 1,789 1,773 1,229 Share premium 23,568 23,443 6,983 Merger reserve 1,167 1,167 1,167 Share-based payments reserve 956 653 635 Retained earnings 4,373 4,160 3,944 Foreign currency translation reserve (17) (7) 10 Equity attributable to owners of the parent 31,836 31,189 13,968 =========== ========= ===========
Ideagen plc
Consolidated Statement of Cash Flows for the six months ended 31 October 2015
Six months Six months ended 31 ended 31 October October 2015 2014 GBP'000 GBP'000 Cash flows from operating activities Profit for the period 6 378 Depreciation of property, plant and equipment 98 60 Loss on disposal of property, plant and equipment 2 - Amortisation of intangible non-current assets 2,043 787 Business acquisition costs in profit or loss - 74 Share-based payment charge 384 85 Finance income recognised in profit or loss (3) (2) Taxation (credit) / charge recognised in profit or loss (121) 75 Decrease in inventories - 293 Decrease / (Increase) in trade and other receivables 19 (36) Decrease in trade and other payables (1,158) (1,060) Decrease in deferred revenue (119) (173) ---------- ---------- Cash generated by operations 1,151 481 Interest received 3 2 Income tax repaid 8 64 Business acquisition costs paid (102) (146) ---------- ---------- Net cash generated by operating activities 1,060 401 ---------- ---------- Cash flows from investing activities Payments of deferred consideration on business combinations - (50) Net cash outflow on acquisition of businesses net of cash acquired - (1,259) Payments for development costs (884) (368) Payments for property, plant and equipment (150) (65) Proceeds of disposal of property, plant and equipment 12 - Net cash used by investing activities (1,022) (1,742) ---------- ---------- Cash flows from financing activities Proceeds from issue of shares under share option scheme 141 123 Net cash generated by financing activities 141 123 ---------- ---------- Net increase / (decrease) in cash and cash equivalents during the period 179 (1,218) Cash and cash equivalents at the beginning of the period 5,266 4,011 Effect of exchange rate changes on cash balances held in foreign currencies (3) 13 Cash and cash equivalents at the end of the period 5,442 2,806 ---------- ----------
Ideagen plc: Consolidated Statements of Changes in Equity
Share Share Merger Share-based Retained Foreign Total capital premium Reserve payments earnings currency attributable reserve translation to owners reserve of the parent -------- -------- -------- ----------- --------- ------------ ------------- GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 For the six months to 31 October 2015 At 1 May 2015 1,773 23,443 1,167 653 4,160 (7) 31,189 Profit for the period - - - - 6 - 6 Share-based payments - - - 384 - - 384 Shares issued under share option scheme 16 125 - - - - 141 Transfer on exercise of share options - - - (81) 81 - - Taxation on share-based payments in equity - - - - 126 - 126 Other comprehensive income for the period - - - - - (10) (10) -------- -------- -------- ----------- --------- ------------ ------------- At 31 October 2015 1,789 23,568 1,167 956 4,373 (17) 31,836 ======== ======== ======== =========== ========= ============ ============= For the six months to 31 October 2014 At 1 May 2014 1,219 6,870 1,167 596 3,520 (3) 13,369 Profit for the period - - - - 378 - 378 Share-based payments - - - 85 - - 85 Shares issued under share option scheme 10 113 - - - - 123 Transfer on exercise of share options - - - (46) 46 - - Other comprehensive income for the period - - - - - 13 13 -------- -------- -------- ----------- --------- ------------ ------------- At 31 October 2014 1,229 6,983 1,167 635 3,944 10 13,968 ======== ======== ======== =========== ========= ============ =============
Ideagen plc: Consolidated Statement of Changes in Equity for the year ended 30 April 2015
Share Share Merger Share-based Retained Foreign Total capital premium reserve payments earnings currency attributable reserve translation to owners reserve of the parent -------- -------- --------- ----------- --------- ------------ ------------- GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 Balance at 1 May 2014 1,219 6,870 1,167 596 3,520 (3) 13,369 Share placing 515 16,985 - - - - 17,500 Share placing issue costs - (584) - - - - (584) Shares issued under share option scheme 39 172 - - - - 211 Profit for the year - - - - 480 - 480 Other comprehensive income for the year - - - - - (4) (4) Share-based payments - - - 142 - - 142 Transfer on exercise of share options - - - (85) 85 - - Taxation on share-based payments in equity - - - - 294 - 294 Equity dividends paid - - - - (219) - (219) Balance at 30 April 2015 1,773 23,443 1,167 653 4,160 (7) 31,189 ======== ======== ========= =========== ========= ============ =============
Ideagen plc
Notes to the interim financial information
1 Basis of information
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