Alfa Financial Software Hldgs PLC Contract wins and trading update (5421D)
October 29 2020 - 3:00AM
UK Regulatory
TIDMALFA
RNS Number : 5421D
Alfa Financial Software Hldgs PLC
29 October 2020
29 October 2020
Alfa Financial Software Holdings PLC
Contract wins and trading update
Alfa Financial Software Holdings PLC ("Alfa" or the "Company"),
a leading developer of mission-critical software for the asset
finance industry, today announces new contract wins as well as an
update on trading.
At the time of our half-year results announcement on 29
September 2020 we had two prospects in our late stage pipeline
where work had started and was ongoing but full contracts were yet
to be signed. We are pleased to announce that the two contracts,
one for a leading US auto finance customer, and one for a leading
US retail bank providing equipment finance in its home market, have
now been signed. The first contract win ranks in the top tier by
contract value and the second ranks in the middle tier by contract
value relative to other Alfa contracts.
In addition, we have won a five year extension to a maintenance
and licence subscription for an existing client, which was not in
the pipeline. This contract win ranks in the top tier by contract
value relative to other Alfa contracts and highlights the strength
of Alfa's intellectual property to generate revenue. Due to the
licence component, this contract extension will impact our 2020
revenues as well as giving an additional underpin to our
maintenance revenues through to 2025.
In addition to this strong momentum in converting our late stage
sales pipeline and securing new contracts, trading was good through
Q3 with revenues of GBP16m in the quarter. This was in line with
last year but down, as expected, on the run-rate for the first half
due to the relative increase in holidays taken by our people during
the period. Cash generation during the period has continued to be
strong.
As a consequence of the continuing strong trading performance,
the greater revenue visibility as a result of strong contract win
momentum, and the five year subscription extension referred to
above, the Board now expects EBIT for the year ending 31 December
2020 to comfortably exceed FY19 actuals. Given the macro-economic
uncertainties, we still remain cautious for 2021, but the
additional contracts recently secured will nonetheless benefit our
financial performance next year.
Andrew Denton, Chief Executive Officer of Alfa said:
"We are delighted to see the improved contract momentum has
continued with very strong recent pipeline conversion. It is
particularly encouraging to see the progress we have made in the
US. Our contract win with a US auto finance customer builds on our
already strong presence in the US automotive market where we also
recently announced Alfa Start for US Auto as well as our first
go-live with that product. Our win in US equipment finance is with
one of the most prestigious names in another highly strategic
market for Alfa and positions us well to increase our share in that
market.
The subscription extension strongly highlights the value of
Alfa's intellectual property. We will continue to use our software
to create new revenue streams such as Cloud Hosting, which was one
of the highlights of the half-year results.
We are pleased that our investment in developing products such
as Alfa Start and our recent release of new functionality in Alfa
Systems version 5.6, particularly its digital capabilities, is
reinforcing our intellectual property and resonating well with
customers. We are also seeing this through the continued
development and conversion of the late stage pipeline, as well as
increased early stage activity which is spread across the whole of
our business. This has the potential to replenish our pipeline,
although this continues to be subject to macro-economic
uncertainty.
Overall it is really pleasing to see that the momentum in the
business is coming through into our increased financial
expectations for the full year".
Enquiries
Alfa Financial Software Holdings
PLC
Andrew Denton, Chief Executive
Officer
Duncan Magrath, Chief Financial
Officer +44 (0)20 7588 1800
Tulchan Communications LLP
James Macey White
Matt Low +44 (0)20 7353 4200
Notes to Editors
Alfa has been delivering software systems and consultancy
services to the global asset and automotive finance industry since
1990. Our best practice methodologies and specialised knowledge of
asset finance facilitates delivery of large software
implementations and highly complex business change projects. With
an excellent delivery track record spanning three decades, Alfa's
experience and performance is unrivalled in the industry.
Alfa Systems, our class-leading technology platform, is at the
heart of some of the world's largest asset finance companies. Key
to the business case for each implementation is Alfa Systems'
ability to replace multiple customer systems with our single
platform. Alfa Systems supports both retail and corporate business
for auto, equipment, wholesale and dealer finance on a
multijurisdictional basis, including leases/loans, originations and
servicing. An end-to-end solution with integrated workflow and
automated processing using business rules, Alfa Systems provides
compelling solutions to asset finance companies.
Alfa Systems is currently used by customers or has live
implementations in 26 countries and Alfa has offices in Europe,
Australasia and North America. For more information, visit
www.alfasystems.com.
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