Avast PLC Q1 Trading Update (5578W)

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RNS Number : 5578W

Avast PLC

18 April 2019

AVAST PLC

FIRST QUARTER TRADING UPDATE

18 April 2019

Avast plc, together with its subsidiaries ('Avast' or 'the Group'), a leading global cybersecurity provider, issues the following scheduled trading update for the first quarter of its current financial year, comprising the period from 1 January 2019 to 31 March 2019.

Financial Summary

 
 ($'m)                                                                        Q1 2019   Q1 2018   Change      Change % 
                                                                                                       %    (excluding 
                                                                                                               FX) (1) 
---------------------------------------------------------------------------  --------  --------  -------  ------------ 
 Adjusted Revenue                                                               211.8     199.6      6.1           6.7 
 Adjusted Revenue excl. Discontinued Business and sale of Managed Workplace 
  (2,3)                                                                         209.1     192.7      8.5           9.1 
---------------------------------------------------------------------------  --------  --------  -------  ------------ 
 

For the first quarter, Adjusted Revenue rose by 9.1% excluding FX, Discontinued Business and the sale of Managed Workplace, and 8.5% in actual rates, to $209.1m. Adjusted Billings grew slightly ahead of revenue.

For the first quarter, Adjusted EBITDA increased 5.4% to $117.5m, resulting in an Adjusted EBITDA margin of 55.5%(4) .

In March, the Group voluntarily paid down US$200m of debt using cash on the balance sheet. At 31 March 2019, net debt / LTM ("last twelve months") Adjusted EBITDA per banking covenant was 2.4x and net debt / Adjusted Cash EBITDA was 2.3x (5) , in line with our expectations.

Vince Steckler, Chief Executive of Avast, commented:

"We have started the year well. Our first quarter performance has been strong, continuing the trading momentum seen in the second half of 2018.

"The Group's cost-effective user acquisition model and large, global user base of more than 435m users remain key competitive strengths for the business. Our market-leading levels of profitability and strong cash generation mean we continue to execute our growth strategy with confidence, and Group expectations for the full year remain unchanged."

Outlook

The Group reaffirms its FY 2019 outlook for high single digit Adjusted Revenue growth, excluding FX, Discontinued Business and the sale of Managed Workplace, and broadly flat Adjusted EBITDA margin% (pre-IFRS 16 adoption).

Avast intends to report Half Year results for the six months to 30 June 2019 on Wednesday 14 August 2019.

ENQUIRIES

Investors and analysts:

Peter Russell, Director of IR

[e-mail]

Media:

Stephanie Kane, VP PR and Corporate Communications

[e-mail]

Jos Simson / Lulu Bridges

Tavistock

Tel: [phone]

Notes

(1) Growth rate excluding currency impact calculated by restating Q1 2019 actual to Q1 2018 FX rates. Deferred revenue is translated to USD at date of invoice and is therefore excluded when calculating the impact of FX on revenue

(2) As the company is exiting its toolbar-related search distribution business, which had previously been an important contributor to AVG's revenues (referred to above, with the Group's browser clean-up business, as "Discontinued Business"), the growth figures exclude Discontinued Business, which the Group expects to be negligible by the end of 2019

(3) To reflect the underlying organic growth performance, figures exclude the impact of the Managed Workplace disposal made at the end of January 2019, through the exclusion of Managed Workplace results in February and March 2018

(4) The impact on Adjusted EBITDA and Cash EBITDA following the adoption of IFRS 16 on 1 January 2019 is $2.1m (favorable impact on EBITDA margin% by 1% point for Q1 2019).

(5) The impact of IFRS 16 on Net debt (lease liabilities) is a $69.6m increase. Leverage ratios excluding the impact of IFRS 16 would be 2.3x on Adjusted EBITDA and 2.2x on Adjusted Cash EBITDA.

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END

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April 18, 2019 02:00 ET (06:00 GMT)