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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Dotdigital Group Plc | LSE:DOTD | London | Ordinary Share | GB00B3W40C23 | ORD 0.5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 2.10 | 2.21% | 97.20 | 97.10 | 98.00 | 98.10 | 94.30 | 94.30 | 519,835 | 16:29:58 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Computer Related Svcs, Nec | 69.23M | 12.6M | 0.0412 | 23.59 | 297.29M |
From Apr 2019 to Apr 2024
TIDMDOTD
RNS Number : 2613Q
dotDigital Group plc
25 February 2021
25 February 2021
dotdigital Group plc
("dotdigital", "the Company" or "the Group")
Interim Results for the six months ended 31 December 2020
dotdigital Group plc (AIM: DOTD), the leading 'SaaS' provider of an omnichannel marketing automation and customer engagement platform, announces its Half Year results for the six months ended 31 December 2020 ("H1 2021").
Financial highlights
Hot Features
Premium
-- Organic revenue from Continuing Operations up by c.22%
to GBP28.2m (H1 2020: GBP23.1m) driven by strong growth
in sales from new and existing customers and uptake of
SMS
-- Adjusted EBITDA from Continuing Operations grew 13% to
GBP10.5m (H1 2010: GBP9.3m)
-- R&D continues to underpin dotdigital's growth strategy
with recurring revenues from enhanced product functionality
growing by 20% to GBP8.9m from GBP7.4m in the comparative
period
-- ARPC(1) up by 20% to GBP1196 per month (H1 2020: GBP999
per month) driven by an increase in new and existing client
spend alongside customers adopting a wider array of channels
-- Cash balance at 31 December 2020 of GBP27.6m (FY 2020:
GBP25.4m)
Operational highlights
Geographic expansion
-- International sales grew proportionately to 33% of total
sales (excluding Discontinued Operations); (H1 2020: 32%).
We have seen a strong pick-up in UK SMS volumes during
the period. Excluding SMS, international sales represented
38% of revenue (H1 2020: 32%)
-- Organic international revenue increased by 27% to GBP9.3m
(H1 2020: GBP7.3m)
-- EMEA region showed strong revenue growth of c.21% in the
period to GBP21.5m (H1 2020: GBP17.7m)
-- US revenue grew organically by c.25% to $6.3m, (H1 2020:
$5.1m) driven by acquisition of higher value customers
and growth of existing customers
-- APAC sales, channel team expansion and increased Asia presence
drove revenue from the region, which grew organically c.41%
to AUS$3.5m, (H1 2020: AUS$2.5m)
Strategic partnerships
-- We continue to build pipeline and enhance our value proposition
for our connectors into both ecommerce platforms and Customer
Resource Management (CRM) software
-- Sales through connectors into our strategic partners increased
by 20% to GBP12.8m (H1 2020: GBP10.7m)
-- Our Shopify connector revenue grew by 115% and our MS Dynamics
connector revenue grew by 25% compared to the same period
in the previous year
-- Our relationships within both the ecommerce and CRM space
continue to go from strength to strength with an enhanced
go-to-market strategy
-- We have accelerated investment in building a more scalable
partnership program and hired an experienced leader to
head up global partnerships to increase management bandwidth
and focus
Product innovation
Product enhancements illustrate the benefits of recent investment and over the period include:
-- Improved AI and data visualisation for product recommendations,
customer persona modelling and product affinity capabilities
-- Intelligent contact data capture capabilities for chat,
along with alerting and multi-language support and a more
personalised customer experience
-- Support for the new Google AMP for Email standard for powerful,
dynamic, rich, app-like data driven content within emails
-- Marketing preference management for Dynamics 365 customers
-- New dotdigital connector for the Microsoft Power Automate
platform
Milan Patel, CEO of dotdigital, commented:
"This was another half of successful delivery against our strategy, delivering double-digit organic growth against a backdrop characterised by the disruption and uncertainty caused by Covid.
Our performance to date has been encouraging, and we are confident in our three pillar strategy for the long-term opportunity available to us. The functionality and ease-of-use of our Engagement Cloud is unmatched and improving all the time. Having invested heavily in our global infrastructure with proven go-to-market strategies in each of our territories, we are well-positioned to continue to grow our international presence both in the second half and in the coming years.
While there are positive signs of a recovery from the pandemic in many of our markets, the macroeconomic environment will be challenging for some time, and we recognise the need for continued vigilance in our approach. That said, the Board is confident in a successful outcome for FY2021, with revenue, adjusted EBITDA(2) and adjusted profit before tax from Continuing Operations expected to be in line with the recently upgraded market expectations.
I would like to thank everyone involved with the business for their continued hard work and dedication in making dotdigital the leading global independent provider of marketing automation technology, and look forward to updating shareholders as we continue to deliver against our strategic growth pillars."
Investor Presentation: https://www.dotdigitalgroup.com/events-presentations/
Investor Video: A highlights video is available on our website http://www.dotdigitalgroup.com
For more information on the platform: http://www.dotdigital.com
THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED TO CONSTITUTE INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION (EU) NO. 596/2014. UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.
For further information please contact:
dotdigital Group Plc Tel: 020 3953 3072 Milan Patel, CEO InvestorRelations@dotdigital.com Paraag Amin, CFO Alma PR (Financial PR) Tel: 020 3405 0210 Josh Royston dotdigital@almapr.co.uk David Ison Kieran Breheny Canaccord Genuity (Nominated Adviser Tel: 020 7523 8000 and Joint Broker) Bobbie Hilliam Georgina McCooke Jonathan Barr, Sales finnCap (Joint Broker) Tel: 020 7220 0500 Stuart Andrews, Corporate Finance Alice Lane, ECM Rhys Williams, Sales N+1 Singer (Joint Broker) Tel: 020 7496 3000 Shaun Dobson, Head of Corporate Finance Alex Bond, Corporate Finance
Prior to this announcement's release, the statement contained inside information for the purposes of Article 7 of Regulation (EU) 596/2014 (MAR) (Market Abuse Regulation).
About dotdigital
dotdigital Group plc's (AIM: DOTD) SaaS omnichannel marketing automation platform, Engagement Cloud, makes it easy for brands to carry out sophisticated, customer data-driven digital marketing campaigns across channels including email, SMS, social, ads, mobile, web and offline.
The platform is currently used by more than 70,000 marketers across more than 110 countries in nine languages, with over 23 billion messages sent in 2020.
Founded in 1999, dotdigital is headquartered in London with offices in Amsterdam, Croydon, Manchester, Cheltenham, New York, Melbourne, Sydney, Singapore, Cape Town, Minsk and Warsaw.
Operational Review
Introduction
This has been a period of strong trading and operational progress for the Group, with continued delivery of double-digit organic growth and positive momentum against all pillars of our growth strategy. A significant amount of work has gone into strengthening the foundations of the business over a number of years and we are seeing the benefits of this reflected in the widening adoption globally of our omnichannel marketing technology platform, Engagement Cloud.
The Group delivered organic revenue growth from Continuing Operations of 22% to GBP28.2m (H1 2020: GBP23.1m) and adjusted EBITDA growth of 13% to GBP10.5m (H1 2020: GBP9.3m). Our recurring revenues derived from enhanced product functionality grew by 20% to GBP8.9m (H1 2020: GBP7.4m), an important indicator of the value created by our focussed R&D programme. The Group is cash generative and maintains a strong balance sheet with no debt and net cash balances of GBP27.6m at period end (FY 2020: GBP25.4m).
We continue to invest in our international markets, product innovation and strengthening our partner relationships in line with the substantial market opportunity, whilst protecting the Group's strong margins. Our 'software-as-a-service' (SaaS) model provides a high-quality and highly visible revenue stream with repeatable characteristics that underpins our future growth plans.
Market
The disruption, uncertainty and new ways of working brought about by Covid have meant organisations have had to rework many aspects of their strategy to stay competitive. However, when it comes to embracing digital, rather than triggering a new set of trends, the pandemic has accelerated existing ones. While the shift to technology-led campaigns in the marketing field has been taking place for some time, items that were in the pipeline for consideration years down the line have been thrust to the forefront of today's board agendas.
dotdigital serves organisations from small to large enterprises across a myriad of sectors, as well as working with governments who use our platform to disseminate information to their various stakeholders. Our top 100 customers represent 32% of revenue. This diversification provides us with a high degree of resilience against the impact of external forces on our end markets. Across the board, we are seeing increased demand from customers for omnichannel capability, with 23% now using more than one channel. In the period under review, we saw substantial growth in SMS, demonstrating the value organisations now attach to increasing the number of touchpoints along the customer journey beyond email.
A recent study on digital trends by Adobe and marketing consultancy Econsultancy found there was a wave of new digital consumers in 2020, amounting to a jump of five to ten years in projected adoption. This huge increase brings with it a host of new challenges for marketeers - over a third of 13,000 respondents to the survey at the heart of the study reported customers are now less loyal to products or brands, with half saying that their existing customers have exhibited new buying behaviours, changes to average basket sizes and new product interests. While the overall direction of travel has remained fairly consistent, with consumer priorities and behaviours evolving at pace, the intelligent use of data is more important than ever in understanding customers and ensuring any engagement with them is personalised and relevant.
Our Engagement Cloud includes all the functionality and insight organisations need to thrive in the current environment. With Forrester predicting global marketing automation spend to grow to $25.1bn by 2027 from $3.8bn today, the Group is well-positioned to continue to capitalise and drive long-term, sustainable and profitable growth.
Strategy
The Group's clear growth strategy places organic growth at its core, centred around three strategic pillars: international diversification; expanded market reach through partnership relationships; and continuous product innovation. In addition to the organic growth strategy, we continue to assess the market for strategic acquisitions, based around three criteria: 1) complementary synergy technologies; 2) product functionality that accelerates go-to-market; and 3) customer base or talent acquisition that helps strengthen our foundations.
Geographic Expansion
As we invest in international markets, our Engagement Cloud platform continues to be well received globally. Organic international revenue was up by 27% to GBP9.3m (H1 2020: GBP7.3m), with international sales now representing 33% of total sales (excluding Discontinued Operations) (H1 2020: 32%), in line with our strategy to grow our global operations. We will continue to build on our global footprint, currently spanning 12 offices worldwide, and we believe we are well placed to benefit from these investments.
EMEA
Our EMEA business grew 21% in the period to GBP21.5m (H1 2020: GBP17.7m), driven by sustained execution of our strategy and the implementation of efficiency measures in previous periods now bearing fruit. The move to a general manager structure across all business units has created more management bandwidth, and the opening of our Netherlands office and investment in people in the region has resulted in strong product up-take and servicing of our existing clients.
North America
Revenues in North America grew 25% to US$6.3m (H1 2020: $5.1m), driven by both the acquisition of higher value customers and increased revenue per existing customer. The investment we have made in marketing and people has helped develop further brand awareness and strengthened the foundations from which we can scale. We are encouraged by our progress in this region which represents a significant growth opportunity for the Group.
APAC
Sales in the APAC region grew 41% to AUS$3.5m (H1 2020: AUS$2.5m). Our expanded presence in the region, including our Singapore office, combined with strengthening relationships with strategic partners and System Integrators (SI), drove brand awareness. Albeit early stage, customer successes we have had in the region have resulted in growing market confidence in our offering and we are seeing increased referrals through our partner network as a result.
Partnerships
The Group continues to broaden and deepen its partnership relationships, amplifying the Group's market reach beyond its direct sales channel. Sales originating through strategic partner referrals increased 20% to GBP12.8m (H1 2020: GBP10.7m).
A strategic technology partner for the Group is defined as a partner where our customer using that technology integration has the potential to represent or accounts for 10% of Group revenue. This strategic partnership model is complemented by a broader general partner referral network which includes over 200 active global partners. A core focus of the strategic partnership network is forging connectors into both ecommerce and CRM platforms, with the aim of building brand awareness as we push out into international markets.
Our strategic partnership with Magento (an Adobe company) continues to strengthen, with our Engagement Cloud live chat product recently bundled into the core code base of the latest version of their ecommerce platform and therefore made available as the default option. Our move into omnichannel through the Comapi acquisition has enabled this increased integration capability. Revenues via our Magento connector increased 10% in the period.
The strengthening of our strategic partnership with Shopify saw connector revenue grow by 115% and revenue from our MS Dynamics connector with an increased focus in sales and marketing, grew by 25%, in the period.
Our focus in the future will continue to be on strengthening and building both ecommerce and CRM partners and we will increase investment in our relationships both from a people and an R&D perspective to enhance our value proposition, in line with our planning at the start of the year.
Product Innovation
Product innovation is integral to the business and we remain committed to ensuring our platform is at the forefront of the market. The benefit of previous years' investments is demonstrated in the monetisation of new enhanced features, which in the period saw functionality revenues grow by 20% to GBP8.9m (H1 2020: GBP7.4m), adding to the recurring revenue base of the Continuing Operations (now 93% of revenue). This demonstrates the value that can be derived not only through our message plans, but also through the creation of new revenue streams through enhanced functionality and data.
During the period we invested GBP3.1m in R&D, underpinning management's commitment to continuous product innovation. Our focus for product innovation centres around the key areas of:
- Data and intelligence - joining all data together to create
a single customer view and help our customers better personalise
their campaigns and be relevant.
- Marketing automation - harnessing artificial intelligence
(AI) and machine learning across targeted parts of the
platform's architecture, informed by our customers' needs
and requirements to give efficiencies to time-poor marketeers.
- Building out further omni-channel functionality to Engagement
Cloud to assist businesses through the full customer journey
at every touch point they have with their customers.
During the period we enhanced AI and data visualisation for product recommendations, customer persona modelling and product affinity capabilities. We also released intelligent contact data capture capabilities for chat, along with alerting and multi-language support and a more personalised customer experience.
People
Our people are at the heart of the business. Our customers value our business not only because of our great technology but because of the expertise of our people who bring the technology to life, providing the right ingredients aide our customers in becoming more successful. The culture at dotdigital is centred around empowering all employees to make decisions which lends to our agile structure and sets us apart. We trust and value all our employees and we thank them for their tireless effort and passion in progressing the Group's vision.
FINANCIAL REVIEW
Revenue
Revenue from Continuing Operations during the period grew 22% to GBP28.2m from GBP23.1m in H1 2020, in line with management expectations. This performance was driven primarily by new customer wins and existing customer growth, in particular the take up of SMS.
Recurring revenue represents c.93% of Continuing Operations revenues, improving visibility on future revenues. Enhanced functionality revenue (which includes licence fees and bolt-on functionality) grew 20% to GBP8.9m from GBP7.4m in H1 2020.
The geographic split of revenues continued to diversify, with international sales now representing 33% of total sales (excluding Discontinued Operations) in the period, up from 32% in H1 2020. Of that, revenues were up 25% in the US to $6.3m (H1 2020: $5.1m), and up 41% in APAC to AUS$3.5m (H1 2020: AUS$2.5m). EMEA revenues grew 21% in the period to GBP21.5m (H1 2020: GBP17.7m).
During the period ARPC(2) increased by 20% to GBP1196 per month (H1 2020: GBP999 per month).
EBITDA
We achieved an Adjusted EBITDA margin from Continuing Operations of 37%, with Adjusted EBITDA from Continuing Operations growing 13% to GBP10.5m from GBP9.3m in H1 2020, which was in line with management expectations. The adjustments include a share-based payment charge of GBP0.35m and exceptional costs of GBP0.05m.
Balance Sheet & Cash Position
dotdigital continues to generate strong cash flow from its Engagement Cloud operations with an interim period end net cash balance of GBP27.6m.
The Group continues to prioritise product development and during the period spent GBP3.1m on development (compared to GBP2.9m in H1 2020). The Group continues to maintain a strong balance sheet with net assets of GBP56.2m and zero debt.
Dividend Policy
A dividend of 0.83p per ordinary share (2020: 0.67p) was proposed by the Company at the time of its Final Results in November last year, demonstrating a commitment from the Board to deliver value by focusing on total shareholder return. This dividend was approved by shareholders at the Annual General Meeting on 21 December 2020 and paid on 29 January 2021.
The Group will continue to conduct a full dividend review at year end; therefore in line with previous years the Board is not proposing an interim dividend.
Outlook
The results and strategic progress achieved in the first half demonstrate the strength of the business foundations that have been established. We are a truly global business with a sophisticated platform that creates customer journeys at every touch point regardless of whether it is a transactional or marketing message.
Expenditure on 'martech' has seen year-on-year growth of 22%, with a combined value of $65.9bn for the UK and North America alone in 2019. With the trend expected to continue, we believe we have the right platform in place from which to scale and a clear strategy that is focused on generating results.
The Board is confident in a successful outcome for FY2021, with revenue, adjusted EBITDA(2) and adjusted profit before tax from Continuing Operations expected to be in line with the recently upgraded market expectations; we continue to monitor and respond to the pandemic as it develops.
(1) ARPC means average revenue per customer
(2) Consensus adjusted EBITDA for continuing operations as at 22 January 2021, for the year ending 30 June 2021, is approx. GBP18.7 million. EBITDA means earnings before interest, tax, depreciation, amortisation, and before restructuring, other non-recurring costs and certain non-cash items.
Dotdigital Group Plc
Consolidated Income Statement
For the six months ended 31 December 2020
----------------------------------------------------------------------------------
Restated* Restated*
6 months 6 months 12 months
to 31 Dec to 31 Dec to 30 June
2020 2019 2020
Unaudited Unaudited Audited
Note GBP'000s GBP'000s GBP'000s
Continuing operations
Revenue from contracts with
customers 4 28,226 23,072 47,404
Cost of sales (5,001) (1,401) (3,801)
---------- ---------- -----------
Gross profit 4 23,225 21,671 43,603
Administrative expenses (15,649) (14,702) (30,541)
Share based payments (344) (341) (682)
Exceptional costs** (68) (67) (136)
---------- ---------- -----------
Operating profit from continuing
operations 7,164 6,561 12,244
Finance income 16 16 40
Finance costs (41) (48) (98)
---------- ---------- -----------
Profit before income tax from
continuing operations 7,139 6,529 12,186
Income tax expense (483) (842) (1,550)
---------- ---------- -----------
Profit for the period from
continuing operations 6,656 5,687 10,636
---------- ---------- -----------
Discontinuing operations
Loss for the year from discontinued
operations (424) (175) (378)
Profit for the period attributable
to the owners of the Company 6,232 5,512 10,258
========== ========== ===========
Earnings per share from all operations (pence per share)
Basic 6 2.09 1.84 3.44
Diluted 6 2.06 1.84 3.39
Adjusted basic 6 2.23 2.00 3.84
Adjusted diluted 6 2.19 1.99 3.79
* Partner commission has been reclassed under administrative expenses instead of cost of sales and comparatives restated.
**The other exceptional costs relate to ongoing acquisition costs of Comapi and amortisation of technology.
Dotdigital Group Plc
Consolidated Statement of Comprehensive Income
For the six months ended 31 December 2020
---------------------------------------------------
Restated Restated
6 months 6 months 12 months
to 31 Dec to 31 Dec to 30 June
2020 2019 2020
Unaudited Unaudited Audited
Note GBP'000s GBP'000s GBP'000s
Earnings per share from continuing operations (pence per share)
Basic 6 2.23 1.90 3.57
Diluted 6 2.20 1.89 3.52
Adjusted basic 6 2.37 2.03 3.84
Adjusted diluted 6 2.33 2.03 3.79
Earnings per share from discontinued operations (pence per share)
Basic 6 (0.14) (0.06) (0.13)
Diluted 6 (0.14) (0.06) (0.13)
Adjusted basic 6 (0.14) (0.04) (0.00)
Adjusted diluted 6 (0.14) (0.04) (0.00)
Dotdigital Group Plc
Consolidated Statement of Comprehensive Income
For the six months ended 31 December 2020
---------------------------------------------------------------------------------------------
Restated Restated
6 months 6 months 12 months
to 31 Dec to 31 to 30 June
2020 Dec 2019 2020
Unaudited Unaudited Audited
note GBP'000s GBP'000s GBP'000s
Profit for the period 6,232 5,512 10,258
Other comprehensive income
Items that may be subsequently
reclassified to
profit and loss:
Exchange differences on translating
foreign operations (79) (133) 34
---------- ---------- -----------
Total comprehensive income attributable
to:
Owners of the parent 4 6,153 5,379 10,292
Total comprehensive income for
the year
Comprehensive income from continuing
operations 6,577 5,554 10,670
Comprehensive income from discontinued
operations (424) (175) (378)
========== ========== ===========
Dotdigital Group Plc
Consolidated Statement of Financial Position
For the six months ended 31 December 2020
--------------------------------------------------------------------
Note As at As at As at
31 Dec 31 Dec 30 June
2020 2019 2020
Unaudited Unaudited Audited
GBP'000s GBP'000s GBP'000s
Assets
Non-current assets
Goodwill 9,680 9,680 9,680
Intangible assets 14,893 12,721 14,059
Property, plant and equipment 722 1,001 862
Right-of-use asset 3,805 5,274 4,400
---------- --------------- ---------
29,100 28,676 29,001
---------- --------------- ---------
Current assets
Trade and other receivables 13,253 13,306 12,987
Cash and cash equivalents 27,556 22,559 25,383
---------- --------------- ---------
40,809 35,865 38,370
---------- --------------- ---------
Total assets 4 69,909 64,541 67,371
========== =============== =========
Equity attributable to the owners of the
parent
Called up share capital 8 1,493 1,493 1,493
Share premium 6,967 6,967 6,967
Reverse acquisition reserve (4,695) (4,695) (4,695)
Other reserves 1,438 1,031 1,372
Retranslation reserve (29) (117) 50
Retained earnings 51,074 42,781 45,514
---------- --------------- ---------
Total equity 56,248 47,460 50,701
========== =============== =========
Dotdigital Group Plc
Consolidated Statement of Financial Position
For the six months ended 31 December 2020
---------------------------------------------------------------------------
As at As at As at
31 Dec to 31 Dec to 30 June
2020 2019 2020
Unaudited Unaudited Audited
note GBP'000s GBP'000s GBP'000s
Liabilities
Non-current liabilities
Lease liabilities 2,885 4,258 3,399
Deferred tax 1,904 1,852 2,169
---------- ---------- -----------
4,789 6,110 5,568
---------- ---------- -----------
Current liabilities
Trade and other payables 7,830 9,867 9,796
Lease liabilities 1,031 1,081 1,068
Current tax payable 11 23 238
---------- ---------- -----------
8,872 10,971 11,102
---------- ---------- -----------
Total liabilities 13,661 17,081 16,670
========== ========== ===========
Total equity and liabilities 69,909 64,541 67,371
========== ========== ===========
Dotdigital Group Plc
Consolidated Statement of Changes in Equity
For the six months ended 31 December 2020
-----------------------------------------------------------------------------------------------------------------------------------------------------------
Share Share Retained Other Reverse Re-translation Total
capital premium Earnings reserves acquisition Reserve
reserve
GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s
As at 1 July
2019 1,490 6,791 37,161 720 (4,695) 16 41,483
Profit for the
period - - 5,512 - - - 5,512
Retranslation
reserve - - - - - (133) (133)
Issue of share
capital 3 176 - - - - 179
IFRS 16
restatement - - 78 - - - 78
Reserve
Transfer - - 30 (30) - - -
Share based
payments - - - 341 - - 341
------------ ------------------ ------------------- ---------------- --------------------- ---------------------------- ---------
As at 31
December
2019 1,493 6,967 42,781 1,031 (4,695) (117) 47,460
------------ ------------------ ------------------- ---------------- --------------------- ---------------------------- ---------
As at 1 January
2020 1,493 6,967 42,781 1,031 (4,695) (117) 47,460
Profit for the
period - - 4,746 - - - 4,746
Dividends - - (1,996) - - - (1,996)
IFRS 16
restatement - - (17) - - - (17)
Retranslation
reserve - - - - - 167 167
Share based
payments - - - 341 - - 341
------------ ------------------ ------------------- ---------------- --------------------- ---------------------------- ---------
As at 30 June
2020 1,493 6,967 45,514 1,372 (4,695) 50 50,701
------------ ------------------ ------------------- ---------------- --------------------- ---------------------------- ---------
As at 1 July
2020 1,493 6,967 45,514 1,372 (4,695) 50 50,701
Profit for the
period - - 6,232 - - - 6,232
Dividends - - (950) - - - (950)
Retranslation
reserve - - - - - (79) (79)
Reserve
transfer - - 278 (278) - - -
Share based
payments - - - 344 - - 344
------------ ------------------ ------------------- ---------------- --------------------- ---------------------------- ---------
As at 31
December
2020 1,493 6,967 51,074 1,438 (4,695) (29) 56,248
============ ================== =================== ================ ===================== ============================ =========
Dotdigital Group Plc
Consolidated Statement of Changes in Equity
For the six months ended 31 December 2020
---------------------------------------------
- Share capital is the amount subscribed for shares at nominal value.
- Share premium represents the excess of the amount subscribed for Share Capital over the nominal value net of the share issue expenses.
- Retained earnings represents the cumulative earnings of the Group attributable to equity shareholders.
- The reverse acquisition reserve relates to the adjustment required to account the reverse acquisition in accordance with International Financial Reporting Standards.
- Other reserves relate to the charge for the share-based payments in accordance with International Financial Reporting Standard 2. The reserve transfer in the period relates to lapsed share options.
- Retranslation reserve relates to the retranslation of a foreign subsidiary into the functional currency of the Group.
Dotdigital Group Plc
Consolidated Statement of Cash Flows
For the six months ended 31 December 2020
--------------------------------------------------------------------------------------------------------------
6 months 6 months 12 months
to 31 Dec to 31 Dec to 30 June
2020 2019 2020
Unaudited Unaudited Audited
note GBP'000s GBP'000s GBP'000s
Cash flow from operating activities 7 7,944 6,650 15,907
Tax paid (982) (74) (124)
---------------- ---------------- ------------------
Net cash generated from operating activities 6,962 6,576 15,783
---------------- ---------------- ------------------
Net cash generated from continuing operating
activities 7,534 6,112 18,214
Net cash generated from discontinuing
operating activities (572) 464 (2,431)
Cash flow from investing activities
Purchase of intangible fixed assets (3,147) (2,835) (6,505)
Purchase of tangible fixed assets (57) (168) (277)
Sales of tangible fixed assets - 3 -
Interest received 16 16 40
---------------- ---------------- ------------------
Net cash used in investing activities (3,188) (2,984) (6,742)
---------------- ---------------- ------------------
Net cash used in continuing investing
activities (3,188) (2,981) (6,741)
Net cash used in discontinuing investing
activities - (3) (1)
Cash flows from financing activities
Equity dividends paid (950) - (1,996)
Repayment of leasing liabilities (572) (527) (1,127)
Loan repayment in relation to acquisition - (5) -
Share issue - 179 179
---------------- ---------------- ------------------
Net cash used in financing activities (1,522) (353) (2,944)
---------------- ---------------- ------------------
Net cash used in continuing financing
activities (1,492) (303) (2,884)
Net cash used in discontinuing financing
activities (30) (50) (60)
Increase in cash and cash equivalents 2,252 3,239 6,097
================ ================ ==================
Cash and cash equivalents at beginning
of period 25,383 19,320 19,320
Effect of foreign exchange rate changes (79) - (34)
Cash and cash equivalents at end of
period. 27,556 22,559 25,383
================ ================ ==================
Dotdigital Group Plc
Notes to interim financial statements
For the six months ended 31 December 2020
-------------------------------------------------------------------------------------------------------------------------------------
1. GENERAL INFORMATION
Dotdigital Group Plc is a company incorporated in England and Wales and
quoted on the AIM market.
2. BASIS OF INFORMATION
These consolidated interim financial statements have been prepared in
accordance with International Financial Reporting Standards ("IFRS") as
adopted by the European Union and on a historical basis, using the accounting
policies which are consistent with those set out in the Group's annual
report and accounts for the year ended 30 June 2020. The interim financial
information for the six months to 31 December 2020, which complies with
IAS 34 'Interim Financial Reporting' has been approved by the Board of
Directors on 25 February 2021.
The unaudited interim financial information for the period ended 31 December
2020 does not constitute statutory accounts within the meaning of Section
435 of the Companies Act 2006. The comparative figures for the year ended
30 June 2020 are extracted from the statutory financial statements which
have been filed with the Registrar of Companies and contain an unqualified
audit report and did not contain statements under Section 498 to 502 of
the Companies Act 2006.
3. SIGNIFICANT ACCOUNTING POLICIES
The accounting policies applied are consistent with those of the annual
financial statements for the year ended 30 June 2020, as described in
those financial statements.
Dotdigital Group Plc
Notes to interim financial statements
For the six months ended 31 December 2020
-----------------------------------------------------------------------------------------------------------------------------------------
4. SEGMENTAL REPORTING
The Group's single line of business is the provision of data-driven omnichannel
marketing automation. The chief operating decision maker considers the
Group's reportable segments to be by geographical location this being
EMEA, US and APAC operations and by business activity, this being core
Engagement Cloud and CPaaS as shown below:
Geographical revenue and results 6 months to 31 December 2020
------------------------------------------------
EMEA US APAC
Operations Operations Operations Total
GBP'000s GBP'000s GBP'000s GBP'000s
Income statement
Revenue 22,973 4,842 1,933 29,748
Gross profit 17,591 4,312 1,738 23,641
Profit/(Loss)
before income
tax 6,387 425 (96) 6,715
----------- ----------- ----------- ---------
Total comprehensive
income attributable
to the owners
of the parent 5,908 362 (117) 6,153
=========== =========== =========== =========
Financial position
Total assets 63,279 4,629 2,001 69,909
Net current assets 26,838 3,623 1,476 31,937
=========== =========== =========== =========
Restated 6 months to 31 December 2019
------------------------------------------------
EMEA US APAC
Operations Operations Operations Total
GBP'000s GBP'000s GBP'000s GBP'000s
Income statement
Revenue 21,718 4,010 1,350 27,078
Gross profit 17,824 3,658 1,270 22,752
Profit before
income tax 4,400 1,767 306 6,473
----------- ----------- ----------- ---------
Total comprehensive
income attributable
to the owners
of the parent 3,593 1,475 311 5,379
=========== =========== =========== =========
Financial position
Total assets 59,287 3,932 1,322 64,541
Net current assets 21,809 2,390 695 24,894
=========== =========== =========== =========
Dotdigital Group Plc
Notes to interim financial statements
For the six months ended 31 December 2020
---------------------------------------------------------------------------------------------------------------------------------------
4. SEGMENTAL REPORTING (CONTINUED...)
Restated 12 months to 30 June 2020
------------------------------------------------
EMEA US APAC
Operations Operations Operations Total
GBP'000s GBP'000s GBP'000s GBP'000s
Income statement
Revenue 43,810 8,325 2,777 54,912
Gross profit 35,354 7,585 2,586 45,525
Profit/(Loss) before
income tax 11,256 598 (46) 11,808
----------- ----------- ----------- ---------
Total comprehensive income
attributable to the
owners of the parent 10,098 291 (97) 10,292
=========== =========== =========== =========
Financial position
Total assets 60,959 4,846 1,566 67,371
Net current assets 26,732 1,006 (470) 27,268
=========== =========== =========== =========
Business activity revenue and results
6 months to 31 December 2020
-------------------------------
Core CPaaS Total
GBP'000s GBP'000s GBP'000s
Income statement
Revenue 28,226 1,522 29,748
Gross profit 23,225 416 23,641
Profit/(Loss) before income tax 7,139 (424) 6,715
--------------- -------------- ---------
Total comprehensive income attributable
to the owners of the parent 6,577 (424) 6,153
=============== ============== =========
Financial position
Total assets 67,069 2,840 69,909
Net current assets 31,169 768 31,937
=============== ============== =========
Dotdigital Group Plc
Notes to interim financial statements
For the six months ended 31 December 2019
--------------------------------------------
4. SEGMENTAL REPORTING (CONTINUED...)
Restated 6 months to 31 December
2019
-------------------------------------
Core CPaaS Total
GBP'000s GBP'000s GBP'000s
Income statement
Revenue 23,073 4,005 27,078
Gross profit 21,671 1,081 22,752
Profit/(Loss) before income
tax 6,529 (56) 6,473
----------- ----------- -----------
Total comprehensive income
attributable to the owners
of the parent 5,554 (175) 5,379
=========== =========== ===========
Financial position
Total assets 61,296 3,245 64,541
Net current assets 25,399 (505) 24,8940
=========== =========== ===========
Restated 12 months to 30 June 2020
---------------------------------------
Core CPaaS Total
GBP'000s GBP'000s GBP'000s
Income statement
Revenue 47,404 7,508 54,912
Gross profit 43,603 1,922 45,525
Profit/(Loss) before income
tax 12,186 (378) 11,808
------------ ------------ -----------
Total comprehensive income
attributable to the owners
of the parent 10,670 (378) 10,292
============ ============ ===========
Financial position
Total assets 65,114 2,257 67,371
Net current assets 28,991 (1,723) 27,268
============ ============ ===========
5. DIVIDS
The proposed final dividend of GBP2,472,466 for the year ended 30 June 2020 of 0.83p per share was paid on the 29 January 2021.
Dotdigital Group Plc
Notes to interim financial statements
For the six months ended 31 December 2020
--------------------------------------------
6. EARNINGS PER SHARE
Earnings per share data is based on the consolidated profit using the weighted average number of shares in issue of the parent Company. Basic earnings per share are calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period.
Diluted earnings per share is calculated using the weighted average number of shares adjusted to assume the conversion of all dilutive potential ordinary shares. Adjusted earnings per share is based on the consolidated profit deducting the acquisition related exceptional costs and share-based payment.
A number of non-IFRS adjusted profit measures are used in this annual report and financial statements. Adjusting items are excluded from our headline performance measures by virtue of their size and nature, in order to reflect management's view of the performance of the Group. Summarised below is a reconciliation between statutory results to adjusted results. The Group believes that alternative performance measures such as adjusted EBITDA are commonly reported by companies in the markets in which it competes and are widely used by investors in comparing performance on a consistent basis without regard to factors such as depreciation and amortisation, which can vary significantly depending upon accounting methods (particularly when acquisitions have occurred), or based on factors which do not reflect the underlying performance of the business. The adjusted profit after tax earnings measure is also used for the purpose of calculating adjusted earnings per share.
Reconciliations to earnings figures used in arriving at adjusted earnings per share are as follows:
6 months 6 months 12 months
to December to December to June
2020 2019 2020
From all operations GBP'000s GBP'000s GBP'000s
Profit for the year attributable to
the owners of the parent 6,232 5,512 10,258
Amortisation of acquisition-related
intangible fixed asset 60 124 501
Other exceptional costs 8 7 16
Share-based payment 344 341 682
---------------- --------------- ----------
Adjusted profit for the year attributable
to the owners of the parent 6,644 5,984 11,457
---------------- --------------- ----------
Adjusted profit for the year attributable to the owners of the parent
from:
Continuing operations: 7,068 6,095 11,454
Discontinuing operations: (424) (111) 3
Management does not consider the above adjustments to reflect the underlying business performance.
The other exceptional costs relate to ongoing acquisition costs of Comapi.
Dotdigital Group Plc
Notes to interim financial statements
For the six months ended 31 December 2020
--------------------------------------------------------------------------------------------------
6. EARNINGS PER SHARE (CONTINUED...)
6 months 6 months 12 months
to 31 Dec to 31 Dec to 30 June
2020 2019 2020
Unaudited Unaudited Audited
All operations
Earnings per Ordinary share:
Basic (pence) 2.09 1.84 3.44
Diluted (pence) 2.06 1.84 3.39
Adjusted basic (pence) 2.23 2.00 3.84
Adjusted diluted (pence) 2.19 1.99 3.79
=========== ================ ==============
Continuing operations
Earnings per Ordinary share:
Basic (pence) 2.23 1.90 3.57
Diluted (pence) 2.20 1.89 3.52
Adjusted basic (pence) 2.37 2.03 3.84
Adjusted diluted (pence) 2.33 2.03 3.79
=========== ================ ==============
Discontinued operations
Earnings per Ordinary share:
Basic (pence) (0.14) (0.06) (0.13)
Diluted (pence) (0.14) (0.06) (0.13)
Adjusted basic (pence) (0.14) (0.04) (0.00)
Adjusted diluted (pence) (0.14) (0.04) (0.00)
Dotdigital Group Plc
Notes to interim financial statements
For the six months ended 31 December 2020
---------------------------------------------------------------------------------------------
6. EARNINGS PER SHARE (CONTINUED...)
6 months 6 months 12 months
to 31 Dec to 31 Dec to 30 June
2020 2019 2020
Unaudited Unaudited Audited
GBP'000s GBP'000s GBP'000s
Profit for the period from all
operations for the purpose of earnings
per share:
Basic 6,232 5,512 10,258
Adjusted 6,644 5,984 11,457
=========== ================ ==============
Profit for the period from
continuing
operations for the purpose
of earnings
per share:
Basic 6,656 5,687 10,636
Adjusted 7,068 6,095 11,454
=========== ================ ==============
Profit for the period from
discontinued
operations for the purpose
of earnings
per share:
Basic (424) (175) (378)
Adjusted (424) (111) 3
=========== ================ ==============
Weighted average number of shares in issue
as follows:
6 months 6 months 12 months
to 31 Dec to 31 Dec to 30 June
2020 2019 2020
Unaudited Unaudited Audited
Weighted average number
Basic 298,547,645 299,689,639 298,306,813
Diluted 303,231,752 300,356,007 302,189,863
================ ================ ============
The adjusted profit for the period, adjusted basic earnings per
ordinary share and adjusted diluted earnings per ordinary share
exclude exceptional costs relating to share based payments GBP343,920
(2019: GBP341,058, 2020: GBP682,116), ongoing acquisition costs
of Comapi GBP7,857 (2019: GBP6,548, 2020: GBP15,714) and amortisation
of acquired intangibles GBP60,000 (2019: GBP123,512, 2020: GBP501,072).
Dotdigital Group Plc
Notes to interim financial statements
For the six months ended 31 December 2020
7. RECONCILIATION OF PROFIT BEFORE CORPORATION TAX TO NET CASH
GENERATED FROM OPERATIONS
6 months 6 months 12 months
to 31 Dec to 31 Dec to 30 June
2020 2019 2020
Unaudited Unaudited Audited
GBP'000s GBP'000s GBP'000s
Profit before income tax
from all operations 6,715 6,473 11,808
Adjustments for:
Depreciation 191 195 426
Amortisation 2,314 1,881 4,148
Right-of-use asset depreciation 460 485 1,122
Exceptional costs 8 - 16
Loss on disposal of fixed
assets - - (3)
Share based payments 344 341 682
IFRS 16 restatement - 78 61
Finance lease non-cash movement 140 50 4
Finance income - (16) -
Finance expense 41 100
Currency revaluation - (133) -
Increase in trade and other
receivables (266) (1,475) (1,157)
Decrease in trade and other
payables (2,003) (1,229) (1,300)
-------------- -------------- -----------
Net cash from operations 7,944 6,650 15,907
============== ============== ===========
8. CALLED UP SHARE CAPITAL
During the period no shares were issued.
Dotdigital Group Plc
Notes to interim financial statements
For the six months ended 31 December 2020
-------------------------------------------------------------------------------------------
9. RELATED PARTY NOTE
Transactions between the company and its subsidiaries, who are related
parties, have been eliminated on
consolidation and are not disclosed
in this note.
Key management remuneration:
Key management include Directors and non-executive
Directors
The remuneration paid for key management for employee services are
as follows:
6 months 6 months 12 months
to 30 June
to 31 Dec 2020 to 31 Dec 2019 2020
Unaudited Unaudited Audited
GBP'000s GBP'000s GBP'000s
Remuneration and other
short-term benefits 285 350 774
Share based payments
on the LTIP options
granted 220 220 438
Pension cost 13 13 25
--------------- ------------------ ----------------
518 583 1,237
=============== ================== ================
The options granted to Paraag Amin can only be exercised at the end of a 3-year performance period, based on an aggressive total shareholder return performance criterion. Under IFRS 2, the group has to provide an estimate for the costs based on Black Scholes model valuation each year, as if they are fully paid out at the end of the performance period in October 2021 for Paraag Amin. To be fully paid out, the group must achieve a compounded 35% TSR over a 3-year period.
In the period, the options that were granted to Milan Patel in December 2017 came to the end of its performance period of which part vested and are under a 2-year holding period from the end of the performance period before they can be exercised, and the remainder lapsed. A new tranche was granted in this period which is based on stretching performance targets on relative total shareholder return and earnings per share. These options for shares will vest in December 2023 when the end of the performance period for that tranche is reached.
Dotdigital Group Plc
Notes to interim financial statements
For the six months ended 31 December 2020
---------------------------------------------
9.RELATED PARTY NOTE (CONTINUED...)
6 months 6 months 12 months
to 31 Dec to 31 Dec to 30 June
2020 2019 2020
Unaudited Unaudited Audited
GBP'000s GBP'000s GBP'000s
The following transactions were carried out
with related parties
Sale of services
Entities controlled by non - executive director
of the Group:
Epwin Group Plc - Email marketing
services 3 - 4
Cadence Performance Ltd - Email
marketing services 1 1 -
---------- --------------------- ---------------
4 1 4
========== ===================== ===============
Year end balances arising from
the sale of services
Entities controlled by non-executive directors
of the Group:
Epwin Group Plc - Email marketing
services 1 - 1
---------- --------------------- ---------------
1 - 1
========== ===================== ===============
10. SUBSEQUENT EVENTS TO 31 DECEMBER
2020
As at the date of these statements and the date they were approved
by the Board of Directors there were no such events to report.
Copies of this interim statement are available form the Company
at its registered office at, No 1 London Bridge London, SE1 9BG.
The interim financial information document will also be available
on the Company's website www.dotdigitalgroup.com.
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