Rosslyn Data Technologies PLC Business Update (5520Q)

TIDMRDT

RNS Number : 5520Q

Rosslyn Data Technologies PLC

29 June 2022

29 June 2022

Rosslyn Data Technologies plc

(the "Company", "Rosslyn" or the "Group")

Business Update

Rosslyn (AIM: RDT), the provider of a leading cloud-based enterprise data analytics platform, provides the following update on its business for the year ended 30 April 2022.

Highlights

   --    Customer rollout commenced of new Rosslyn platform - with very positive feedback received 
   --    Rebrand as 'Rosslyn' complete - reflecting the strategic focus on core SaaS platform 
   --    Successful execution on partner-led go-to-market approach 
   --    Implementation underway of initial recommendations of new Customer Advisory Board 

-- Revenue for the year ended 30 April 2022 expected to be GBP5.9m in line with market expectations

   --    Current pipeline is substantially higher than at the same point last year 

As noted in the Company's interim results announcement of 31 January 2022, during the first half of the year, the Group embarked on a major restructure of the business, resulting in a refocussing on a single core product (the RAPiD platform) and a SaaS business model; a refreshed operational leadership team; and a renewed go-to-market strategy. This included undertaking a rebranding programme, which was completed post year end, to refresh Rosslyn's appearance making it more engaging for today's market and aligning it with the new direction of the business. In particular, the Group is now branded as 'Rosslyn' to reflect the strategic focus on a core SaaS platform.

Revenue for the year ended 30 April 2022 is expected be GBP5.9m (FY 21: GBP7.4m), in line with market expectations. Significant investment was made during the year in development work to modernise the RAPiD platform (renamed as "Rosslyn"). The development work associated with this modernisation took longer than anticipated, with the upgraded version commencing beta testing at the end of the six-month period to 31 October 2021 and customer rollout beginning in April 2022. As a result of the increased costs pertaining to the extended development period, the Group expects, subject to audit, to report EBITDA losses in the region of GBP3.2m-GBP3.4m (FY 21: GBP1.3m).

Historically the Group has expensed its development costs but, following advice from the Company's auditors, the Board has determined that it will update the Company's accounting policy on development costs under accounting standard IAS 38 - Intangible Assets. It is expected that the application of this policy for FY 22 will result in the Group reporting, subject to audit, an improved EBITDA loss in the region of GBP2.2m-2.4m. For the avoidance of doubt, under the Group's existing accounting policy the Group would, subject to audit, expect to report an EBITDA loss in the region of GBP3.2m-GBP3.4m.

The new Rosslyn platform delivers a simplified, more intuitive interface and streamlined navigation, making it easier for users to quickly gather the insight they need. The collaboration functions have been improved to facilitate the sharing of dashboards and reports with key stakeholders across a business. There is also a closer integration between data and visualisation, including features such as enabling specialist teams within customer organisations to have their own tailored view of procurement data. A number of major customers have now been onboarded to the upgraded Rosslyn platform and the Company is receiving very positive feedback. The upgraded platform enables the Company to shift from data intelligence and insight being the domain of a small portfolio of technical specialists to one where procurement professionals operating across the supply chain can make decisions as a result of being able to configure dashboards around a variety of data sources. The Group is already seeing a number of its customers grow their user base 500%+ in the early adoption of the new platform.

During the second half, the Company embarked on bringing its go-to-market strategy more in line with its product. This involved pivoting to a partner-led approach and targeting channels that focus on best-of-breed technology solutions. Rosslyn has established partnerships across the business process outsourcing, system integrator and strategic consulting market. These partnerships have been central to recent deal wins, including from one of the largest Japanese financial institutions, and are responsible for the core of the Company's long-term pipeline. By adopting this partner-led approach, the Company expects to be able to secure longer-term contracts and to enhance its service provision by leveraging the deeper domain expertise of its partners.

Towards the end of the year, the Company held the inaugural meeting of its Customer Advisory Board and has already begun implementing some of the recommendations. Particularly, Rosslyn has started incorporating a broader range of data - such as related to supply chain risk, sustainability and diversity - into the analytics alongside supplier spend data, with two customers already trialling this feature.

As previously stated, the Integritie and Langdon Systems acquisitions, whilst performing well since they became part of the Group, have limited crossover with the Group's core business in terms of customer base or strategic rationale. As a result, the Board believes that it is in the best interests of shareholders and of the Group as a whole to divest these non-core elements. This will enable the Group's resources to be focussed on executing on its core strategy and allow proceeds from the disposals to be reinvested in accelerating this strategy. The Company is actively pursuing divestment opportunities and expects to be able to update the market on progress in the near term.

The new Rosslyn platform is, the Board believes, the core foundation for significant growth within the Group. The Group's pipeline dynamics have been transformed as a result of a new sales and marketing team that was put in place in January, with the current pipeline substantially higher than at the same point last year. The Board is pleased that the pipeline has pivoted considerably towards the partner-led go-to-market, with one major BPO partner completing over 10 funded proof-of-concepts in the second half alone, two of which are now expected to move into production customers in Q1.

The Company has made a positive start to the current financial year to 30 April 2023 with two significant deals closed with financial institutions since 1 May 2022 and, based on the increasing pipeline, the Board is confident that the Group's continuing operations will generate meaningful revenue growth over financial year 2022.

Paul Watts, CEO of Rosslyn Data Technologies, commented:

"I am pleased with the progress that has been made over this last year. A significant amount of work has been put into modernising our platform. We now expect to start seeing the fruits of the labour come through in FY 23. Moving towards a partner-led business model, based on a procurement analytics market moving towards a best-of-breed approach to technology, is a paradigm shift for the Group. Since the last quarter of FY 22, we have had a record number of new inbound opportunities, which I believe validates our strategy and underpins our confidence in the future."

This announcement contains inside information

Enquiries

 
 Rosslyn Data Technologies plc 
                                         [phone] 
 Paul Watts, Chief Executive Officer      [phone] 
  James Appleby, Chairman                 [phone] 
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 Cenkos Securities (Nominated adviser 
  and Broker) 
                                        -------------------- 
 Stephen Keys/Camilla Hume               [phone] 
                                        -------------------- 
 
 Luther Pendragon (Financial PR) 
                                        -------------------- 
 Harry Chathli/Claire Norbury            [phone] 
                                        -------------------- 
 

About Rosslyn Data Technologies plc

Rosslyn (AIM: RDT) provides an award-winning spend analytics and predictive analytics platform. The Rosslyn Platform helps organizations with diverse supply chains mitigate risk and make informed strategic decisions. It leverages automated workflows, artificial intelligence and machine learning to extract and consolidate procurement data providing visibility of complex supplier data, enabling supplier spend savings and delivering rapid ROI.

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