TIDMATQT
RNS Number : 0849B
ATTRAQT Group PLC
29 September 2022
29 September 2022
Attraqt Group plc
("Attraqt", the "Group" or the "Company")
Half Year results
Attraqt Group plc (AIM:ATQT), the provider of SaaS solutions
that power exceptional online shopping experiences, is pleased to
announce its unaudited results for the six months ended 30 June
2022.
GROUP FINANCIAL HIGHLIGHTS
-- Revenue increased 9% to GBP12.2m (11% at CER) (HY2021: GBP11.1m)
-- Gross profit increased by 2% to GBP8.3m (6% at CER) (HY2021: GBP8.1m)
-- Adjusted EBITDA(1) was GBP0.2m (GBP0.3m at CER) (HY2021: GBP0.5m)
-- Loss before tax was GBP2.2m (HY2021: GBP1.8m)
-- Basic EPS loss 0.9p per share (HY2021: 0.7p loss per share)
-- Operating cash inflow of GBP0.3m (HY2021 outflow of GBP1.3m)
-- Cash at the period end was GBP2.5m (FY2021: GBP3.5m)
NON-FINANCIAL KPIs
-- Exit annual recurring revenue (ARR) increased 10% to GBP24.2m
(8% at CER) (FY2021: GBP21.9m)
-- GBP1.9m of new logos signed (HY2021: GBP0.6m), including two
large UK high street fashion retailers
-- ARR Bookings of GBP2.6m (HY2021: GBP1.8m), increase by 39%
-- 21 new logos signed in H1 (HY2021: 8)
-- Net retention rate of 102% (HY2021: 103%)
-- 12 multi-year renewals (HY2021: 14)
RECOMMED CASH OFFER FOR ATTRAQT
-- Recommended cash offer for Attraqt at a price of 30p per
share by Crownpeak Technology, Inc. For details, refer to Rule 2.7
firm offer announcement released this morning
Tom Crawford, Non-Executive Chairman of Attraqt, commented:
"Over the past six months we have continued to make strides
forward as we see the benefits of our investments in our technology
and product offering starting to come through. We have seen
positive momentum in bookings, with strong new logo performance
despite lengthening sales cycles, but a more challenging revenue
and profit performance, given the time it takes to monetise new
enterprise logo wins to full revenue, combined with a material
increase in cost of sales due to new customer sale patterns driving
higher hosting costs and more recently the unfavourable foreign
exchange movements on cost of sales.
I would like to take this opportunity to thank every member of
the Attraqt team for their hard work and commitment during the
first half. Your drive to provide the best possible technology and
service to our clients has shone through.
Throughout the first half we have focused our efforts on ARR
bookings and building the future revenue base, and we will continue
in this vein going forwards as we believe it is better to build
sales momentum and then move focus to margin in anticipation of
advances in EBITDA and cashflow in future years. As a result, I
remain cautiously optimistic of the Group's continued growth,
either on a standalone basis, or as part of Crownpeak."
1. Adjusted EBITDA refers to earnings before interest, tax,
depreciation, amortisation, share based payments and exceptional
items.
FOR FURTHER INFORMATION, PLEASE CONTACT:
+44 (0)7747 766
Attraqt Group plc 849
Eric Dodd, CFO
+44 (0)20 7523
Canaccord Genuity 8000
Simon Bridges
Adam James
Tom Diehl
+44 (0)20 3405
Alma PR 0205
Sam Modlin attraqt@almapr.co.uk
Andy Bryant
ABOUT ATTRAQT GROUP
Attraqt enables online retailers and brand owners to maximise
the performance and potential of their e-commerce investments by
enabling best in class product discovery experiences. The Company
delivers omnichannel search, merchandising, and product &
content personalization for online retailers and brands. Our vision
is to be the number one team and growth engine for our customers;
powering the world's best product discovery experiences, wherever
and whenever they happen.
For more information visit www.attraqt.com
CHIEF EXECUTIVE OFFICER'S STATEMENT
Throughout the first half the Company has continued to see good
momentum in bookings with encouraging new client wins across both
product sets. This is despite the challenging market backdrop and
reflects our investment in AI and visual merchandising, the
strength of our partnerships and a successful focus on the
mid-market.
The AI backed differentiation of our offering is highlighted by
the increase in our win rate in the half, with momentum in
converting new business opportunities and extending our
track-record of being selected as the preferred solution versus
competing products.
REVIEW OF SALES AND OPERATIONS
Revenue for H1 2022 was up 9% to GBP12.2m (11% at CER) (HY2021:
GBP11.1m) for the period, driven by monetising 2021 bookings.
The Company has continued to see good momentum in bookings, with
strong new logo performance. Annual Recurring Revenue (ARR)
bookings in H1 increased by 39% to GBP2.6m (HY2021: GBP1.8m) and
the closing ARR is up c.20% (annualised) to GBP24.2m (FY21:
GBP21.9m) (16% at constant exchange rates). Enterprise performance
was strong with two UK fashion brands and two international brands
signing in the reporting period, all following competitive tenders.
The win rate has increased due to sales momentum and AI becoming
the centrepiece of the Company's offering, providing greater
competitive differentiation.
Our innovation and embedding the technology from our
acquisitions is also the driver of our sales wins in the
Mid-Market. Our product discovery solutions for the Mid-Market are
class leading, evidenced by the contract momentum and growing
pipeline, as we increasingly bring Enterprise grade functionality
to the Mid-Market powered by AI. We signed 12 Mid-Market logos in
the first half compared to 7 in HY2021.
We are also pleased with the investment we have made in
supporting our existing client base with 12 multi-year renewals
(HY2021: 14). This was down year-on-year due to a product of
timing, with fewer clients eligible for renewal during the period
compared to HY2021 as many clients are already on multi-year
agreements.
Recurring bookings increased by 39% to GBP2.6m and encouragingly
this included some significant wins with opportunity to expand, for
example with two UK high street retailers and US-based fashion
brands.
Gross churn continued to fall and was GBP0.9m (HY2021: GBP1.0m),
due to the increasing strength of our relationship with our
existing clients, lower contracts coming up for renewal and the
process of sunsetting of the Freestyle Merchandising product
nearing conclusion.
PERFORMANCE AGAINST GROWTH STRATEGY
Despite the continued uncertainty of the external environment
seen in the first six months of the year and going forwards, we
have continued to make progress against many our strategic
priorities.
Our ongoing priorities are:
-- Evolving our data-led approach
-- Increasing the speed of our innovation
-- Executing our partnership strategy
-- Replicating our UK success in other geographies
-- Improving the customer and developer experience
-- Being recognised as a market leader
In the half we are particularly pleased with our achievement in
replicating some of our UK success into overseas markets deals with
notable enterprise wins in the US and Germany. Our initial focus in
the mid-market has been optimising the solution for the UK market
but we have made significant progress in France which now accounts
for around a third of our Mid-Market pipeline.
Our investment in the products and roadmap was recognised in the
recent Gartner Magic Quadrant for Personalisation Engines. We are
positioned to continue to take market share in both the Enterprise
and mid-market, reflected in our win rates, success outside of the
UK in a backdrop that has challenged some of our competitors.
Our focus in the second half is to continue to grow our presence
in the Mid-Market, accelerate investment in partnerships and
integrations, and continue to build on our momentum outside the UK
to further validate the Enterprise opportunity with global
retailers.
OUTLOOK
The Group continues to progress its go to market strategy in
existing geographies and has grown new logo bookings in the first
half including making headway with the launch of product to the
mid-market and some large UK headquartered enterprise sales.
The Group must now demonstrate that it can fully access the
market opportunity open to it, and maintain its new logo win rate,
including enterprise sales, as it converts the pipeline it has been
building over recent periods, while monetising its new clients to
full revenue over time.
The current global macroeconomic environment has been impacting
the rate of progress through the strengthening dollar exchange
rate, extended competitive sales cycles and the normalisation of
ecommerce activity post lockdowns. However, the Board is encouraged
by the new two product strategy and mid-market launch and
anticipates longer term upside as its go to market strategy
matures.
While the Group consumed cash in the first half of the year,
actions taken mean that the cost base in the second half of the
year will be materially lower than the first half on a constant
currency basis, as the business approaches its goal of becoming
cash neutral for 2023.
The Board is, however, cognisant of the difficult external
factors that are introducing an additional layer of risk into sales
processes and, whilst the current pipeline is healthy and
supportive of the Group's short-term objectives, it is therefore
prudently managing operating margin and discretionary investment in
order to ensure the Group underpins its growth expectations, with
advances in earnings and cashflow in future years.
Mark Adams
Chief Executive Officer
FINANCIAL REVIEW
Total revenue increased by 9% to GBP12.2m (HY2021: GBP11.1m).
SaaS revenues increased by 11% to GBP11.3m driven by lower
attrition and monetisation of 2021 bookings. Annual Recurring
Revenue (ARR) increased by 10% in the six-month period at Actual
exchange rates and by 8% at Constant exchange rates. Services
revenue decreased by 3% to GBP0.9m.
Recurring bookings increased by 39% to GBP2.6m in the period
(HY2021: GBP1.8m). Enterprise and mid-market new logo bookings were
strong.
Total bookings in the period YTD were GBP3.4m.
Gross profit increased by 2% to GBP8.3m (6% at CER) (HY2021:
GBP8.1m), with a gross margin of 68% (HY2021: 73%).
The SaaS gross margin decreased by 5% points to 73% (74.5% at
CER) due to increased hosting fees due to the business not reacting
quickly enough to an increase in sales events by our major
customers, which has now been addressed, and the impact of the
strong dollar. The Services gross margin decreased by 8% points as
services revenue were flat, but staff costs increased.
Operating expenses (defined as Total administrative expenses
less exceptional items, amortisation and depreciation) increased by
6% to GBP8.1m (HY2021: GBP7.6m) due to the impact of the hiring of
the mid-market sales team which drove the increase in bookings
mentioned above. To the loss from operations before tax of GBP2.2m
we add back exceptional costs of GBP0.3m and depreciation and
amortisation costs of GBP2.3m, then deduct share-based credit of
GBP0.2m to give the Adjusted EBITDA figure of GBP0.2m.
Adjusted EBITDA profit of GBP0.2m (GBP0.3m at CER) (HY2021:
GBP0.5m profit) was in line with management's expectations.
The exceptional costs of GBP0.3m in the period relate to
severance costs.
Depreciation and amortisation totalled GBP2.3m (HY2021: GBP1.9m)
and increased in line with the scale of the business. There was a
share-based credit of GBP0.2m (HY2021: charge of GBP0.1 m).
The loss before tax was GBP2.2m (HY2021: GBP1.8m loss) and the
tax credit in the period of GBP0.3m (HY2021: GBP0.4m). Therefore,
the loss for the half year was GBP1.9m (HY2021: GBP1.4m loss).
The loss per share increased to 0.9p (HY2021: 0.7p loss) partly
due to exceptional charges.
There was a cash inflow of GBP0.3m from operations (HY2021: cash
outflow of GBP1.3m), due to the absence of non-recurring items.
Collections remain good and bad debts are low.
The cash balance at 30 June 2021 was GBP2.5m and the cash
balance at 30 December 2021 was GBP3.5m. While the Group consumed
cash in the first half of the year, actions taken mean that the
cost base in the second half of the year will be materially lower
than the first half on a constant currency basis, as the business
approaches its goal of becoming cash neutral for 2023. To provide
additional financial flexibility, the Company has had a working
capital facility of GBP1.5m credit approved from Barclays.
The directors continue to believe that the preparation of these
condensed consolidated interim financial statements should be on
the basis of a going concern.
Eric Dodd
Chief Financial Officer
(1) Adjusted EBITDA refers to earnings before interest, tax,
depreciation, amortisation, other income, foreign exchange and also
exceptional items (exceptional items set out in note 6)
CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED INTERIM INCOME STATEMENT FOR THE SIX MONTHSED 30
JUNE 2022
Note HY2022 HY2021 FY2021
(unaudited) (unaudited)
GBP'000 GBP'000 GBP'000
Revenue 5 12,195 11,141 22,863
Cost of Sales 5 (3,936) (3,040) (6,698)
----------------------------------- ---- ------------- ------------ --------
Gross profit 8,259 8,101 16,165
Administration expenses (10,186) (9,619) (19,763)
Exceptional administrative expense 6 (257) (264) (562)
----------------------------------- ---- ------------- ------------ --------
Total administrative expenses (10,443) (9,883) (20,325)
----------------------------------- ---- ------------- ------------ --------
Loss from operations (2,184) (1,782) (4,160)
Finance costs (24) (31) (82)
Loss before tax (2,208) (1,813) (4,242)
Taxation credit 7 322 390 711
----------------------------------- ---- ------------- ------------ --------
Loss for the period/year (1,886) (1,423) (3,531)
----------------------------------- ---- ------------- ------------ --------
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX
MONTHSED 30 JUNE 2022
Note HY2022 HY2021 FY2021
(unaudited) (unaudited)
GBP'000 GBP'000 GBP'000
---------------------------------------------- ---- ------------- ------------ -------
Loss for the period/year (1,886) (1,423) (3,531)
---------------------------------------------- ---- ------------- ------------ -------
Foreign exchange translation differences (31) (138) (251)
---------------------------------------------- ---- ------------- ------------ -------
Total comprehensive loss for the period/year,
attributable to shareholders of the
parent (1,917) (1,561) (3,782)
---------------------------------------------- ---- ------------- ------------ -------
Loss per share attributable to the
ordinary equity holders of the company
---------------------------------------------- ---- ------------- ------------ -------
Basic and diluted EPS 8 (0.9p) (0.7p) (1.8p)
---------------------------------------------- ---- ------------- ------------ -------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Notes HY2022 HY2021 FY2021
(unaudited) (unaudited)
GBP'000 GBP'000 GBP'000
Non-current assets
Plant and equipment 199 248 220
Right of use assets 905 902 1,171
Intangible assets 9 40,284 39,996 41,211
Total non-current assets 41,388 41,146 42,602
------------------------------------ ------ ------------- ------------ -------------------------
Current assets
Trade and other receivables 7,059 6,877 6,026
Cash and cash equivalents 10 2,470 3,522 3,515
Corporation tax recoverable 498 308 494
------------------------------------ ------ ------------- ------------ -------------------------
Total current assets 10,027 10,707 10,035
------------------------------------ ------ ------------- ------------ -------------------------
Total assets 51,415 51,853 52,637
------------------------------------ ------ ------------- ------------ -------------------------
Current Liabilities
Trade and other payables 10,926 9,393 9,466
Lease liability 498 459 614
Corporation tax 513 554 672
Total current liabilities 11,937 10,406 10,752
------------------------------------ ------ ------------- ------------ -------------------------
Non-current liabilities
Deferred tax liability 2,302 2,660 2,481
Bank Loan 404 - 394
Lease liability 540 497 686
Total non-current liabilities 3,246 3,157 3,561
------------------------------------ ------ ------------- ------------ -------------------------
Net Assets 36,232 38,290 38,324
------------------------------------ ------ ------------- ------------ -------------------------
Equity
Issued capital 11 2,016 1,961 2,016
Share premium 11 55,480 53,251 55,480
Merger reserve 1,457 1,457 1,457
Share based payment 1,522 1,726 1,697
Forex reserve (557) (413) (526)
Retained earnings (23,686) (19,692) (21,800)
------------------------------------ ------ ------------- ------------ -------------------------
Total equity attributable to equity
holders of the parent 36,232 38,290 38,324
------------------------------------ ------ ------------- ------------ -------------------------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHSED
30 JUNE 2022
Share Share Merger Share Foreign Retained Total
Capital premium reserve based exchange earnings
payment reserve
reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 January 2021 1,961 53,251 1,457 1,585 (275) (18,269) 39,710
Loss for the period - - - - - (1,423) (1,423)
Foreign currency translation
differences - - - - (138) - (138)
---------------------------------------------------------------------------- -------- -------- -------- -------- --------- --------- -------
Total comprehensive loss
for the period - - - - (138) (1,423) (1,561)
Contributions by and distributions
to owners
Share based payment charge - - - 141 - - 141
Total contributions by and
distributions to owners - - - 141 - - 141
---------------------------------------------------------------------------- -------- -------- -------- -------- --------- --------- -------
Balance at 30 June 2021 1,961 53,251 1,457 1,726 (413) (19,692) 38,290
---------------------------------------------------------------------------- -------- -------- -------- -------- --------- --------- -------
Loss for the period - - - - - (2,108) (2,108)
Foreign currency translation - - - - - - -
differences
---------------------------------------------------------------------------- -------- -------- -------- -------- --------- --------- -------
Total comprehensive loss
for the period - - - - - (2,108) (2,108)
---------------------------------------------------------------------------- -------- -------- -------- -------- --------- --------- -------
Contributions by and distributions
to owners
---------------------------------------------------------------------------- -------- -------- -------- -------- --------- --------- -------
Shares issued 55 2,229 - - - - 2,284
Issue costs - - - - - - -
Contingent shares to be issued - - - - - - -
Share based payment charge - - - (29) - - (29)
Foreign currency translation
differences - - - - (113) - (113)
Total contributions by and
distributions to owners 55 2,229 - (29) (113) - 2,142
---------------------------------------------------------------------------- -------- -------- -------- -------- --------- --------- -------
Balance at 31 December 2021 2,016 55,480 1,457 1,697 (526) (21,800) 38,324
---------------------------------------------------------------------------- -------- -------- -------- -------- --------- --------- -------
Loss for the period - - - - - (1,886) (1,886)
Foreign currency translation
differences - - - - (31) - (31)
---------------------------------------------------------------------------- -------- -------- -------- -------- --------- --------- -------
Total comprehensive loss
for the period - - - - (31) (1,886) (1,917)
---------------------------------------------------------------------------- -------- -------- -------- -------- --------- --------- -------
Contributions by and distributions
to owners
Share based credit - - - (175) - - (175)
Total contributions by and
distributions to owners - - - (175) (31) (1,886) (2,092)
---------------------------------------------------------------------------- -------- -------- -------- -------- --------- --------- -------
Balance at 30 June 2022 2,016 55,480 1,457 1,522 (557) (23,686) 36,232
---------------------------------------------------------------------------- -------- -------- -------- -------- --------- --------- -------
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE SIX MONTHSED 30
JUNE 2022
Notes HY2022 HY2021 FY2021
(unaudited) (unaudited)
GBP'000 GBP'000 GBP'000
Cash flows from operating activities
Loss for the period/year (1,886) (1,423) (3,531)
Adjustments for:
Depreciation of property, plant and
equipment 54 76 142
Amortisation of intangible fixed assets 9 1,932 1,591 3,454
Amortisation of right of use assets 266 268 522
Income tax (credit)/charge (322) (390) (711)
Share based (credit)/payment 12 (175) 141 215
Finance costs 24 31 82
Foreign exchange differences 24 (81) (49)
------------------------------------------- ----- ------------- ------------ -------
(83) 213 124
(Increase)/decrease in trade and other
receivables (1,033) (774) 129
(Decrease)/increase in trade and other
payables 1,460 (1,554) (1,011)
------------------------------------------- ----- ------------- ------------ -------
Cash (used in)/generated from operating
activities before interest and tax 344 (2,115) (758)
Taxation (paid)/received (18) 774 841
Net cash (used in)/generated from
operating activities 326 (1,341) 83
Cash flows (used in)/generated from
investing activities
Acquisition of IP software 9 0 (350) (350)
Purchases of Property, plant and equipment (32) (46) (128)
Development of intangibles 9 (955) (1,001) (2,025)
Net cash (used in)/from investing
activities (987) (1,397) (2,503)
Cash flows from financing activities
Lease principal payments (241) (213) (540)
Lease interest payments (22) (31) (66)
Issue of ordinary shares, net of issue - - -
costs
Loan received - - -
Repayments of loan (13) (13) (26)
Net cash (used in)/generated from
financing activities (276) (257) (632)
------------------------------------------- ----- ------------- ------------ -------
Net (decrease)/increase in cash and
cash equivalents (937) (2,995) (3,052)
------------------------------------------- ----- ------------- ------------ -------
Cash and cash equivalents at beginning
of period/year 3,515 6,591 6,591
Effect of foreign currency exchange
rate changes (108) (74) (24)
------------------------------------------- ----- ------------- ------------ -------
Cash and cash equivalents at end of
period/year 2,470 3,522 3,515
------------------------------------------- ----- ------------- ------------ -------
NOTES TO THE CONSOLIDTAED INTERIM FINANCIAL STATEMENTS
1. GENERAL INFORMATION
Attraqt Group plc (the 'Company') and its subsidiaries'
(collectively, the 'Group') principal activity is the development
and provision of eCommerce site search, merchandising and
recommendation technology.
The Company is a public limited company, which is listed on the
London Stock Exchange, incorporated, registered and domiciled in
England (registered number: 08904529). The address of its
registered office is 7(th) Floor, 222-236 Grays Inn Road, London,
WC1X 8HB.
The condensed consolidated interim financial statements for the
six months ended 30 June 2022 was approved by the Board on 23
September 2022.
2. BASIS OF PREPERATION
BASIS OF PREPERATION OF INTERIM FINANCIAL STATEMENTS
The condensed consolidated interim financial information has
been prepared in accordance with the Disclosure and Transparency
Rules of the Financial Conduct Authority and with IAS 34 Interim
Financial Reporting. They do not include all the information
required for full annual financial statements and should be read in
conjunction with information contained in the Group's Annual Report
and Accounts for the year ended 31 December 2021.
The financial information for the year ended 31 December 2021
does not comprise statutory accounts within the meaning of section
434 of the Companies Act 2006 for that year, but it is derived from
those accounts. Statutory accounts for the year ended 31 December
2021 were approved by the Board of Directors on 7 April 2022 and
delivered to the Registrar of Companies. The report of the auditor
on those accounts was unqualified, did not draw attention to any
matters by way of emphasis and did not contain statements under
section s498 (2) or (3) of the Companies Act 2006.
GOING CONCERN
As part of the Directors' consideration of the appropriateness
of adopting the going concern basis in preparing the financial
statements, given the uncertainty of COVID-19.
The Group has continued to monitor the impact of COVID-19 and
situation in Ukraine by reviewing the monthly results versus the
budget set for 2022. The Group has not seen a severe impact in the
year with consolidated Revenue up year on year, Revenue for half
year being just 1% behind budget, and consolidated EBITDA on
budget. The consolidated cash balance available to the Group at 30
June 2022 is healthy at GBP2,470,000. The Group has continued to
offer services and support to our clients uninterrupted by the
national lockdowns in prior year and has not relied upon any
furlough schemes available.
The Group has assessed the ongoing situation in Ukraine and
there is limited impact to the business because the Group has no
customers or assets in Ukraine, Belarus or Russia. We note that
some of our multinational customers have paused business operations
in Russia in response to the situation but due to the global reach
of these customers, the Group has determined that there will be
limited effect. The Group will continue to monitor the situation.
The Group's Directors have revised the Groups forecast taking into
account the resilience of future sales, customers and the impacts
of future possible COVID-19 related national lockdowns and
performed sensitivity analysis on monthly consolidated cash flows
to August 2023. Those forecasts make assumptions in respect of
future trading conditions, notably the economic environment and its
impact on Group's revenues. The forecasts take into account
foreseeable downside risks, based on the information that is
available to the Directors at the time of approval of these
financial statements, however it is not possible to quantify the
ongoing impact with certainty.
Directors have identified that there is sensitivity to a
reduction in revenue receipts, with sustained reduction of over
6.75% of annual recurring revenue bringing the Group outside
existing cash facilities without any mitigating cost reductions,
however they consider this to be unlikely given the impact seen
within the business in the current financial year to date and the
return to normal with the lifting of restrictions.
Should revenue cash flows deteriorate, management would take
some mitigating actions, which include but are not limited to:
-- Negotiating longer credit terms with suppliers;
-- Changing invoicing terms with customers to upfront
payment;
-- Reduction in marketing spend in relation to events; and
-- Delay in staff recruitment.
Based on the above, acknowledging the uncertainty in the
economic environment as a result of the pandemic, the Board remains
satisfied that the Group holds sufficient cash together with bank
and other facilities and has further options available to meet its
working capital requirements for at least 12 months from the date
of approval of these financial statements and therefore supports
the preparation of the financial statements on a going concern
basis.
3. ACCOUNTING POLICIES
In preparing the condensed consolidated interim financial
information, the same accounting policies, methods of computation
and presentation have been applied as set out in the Group's Annual
Report and Accounts for the year ended 31 December 2021. The
accounting policies are consistent with those of the previous
financial year and corresponding interim reporting period.
The annual financial statements of the Group are prepared in
accordance with international accounting standards in conformity
with the requirements of Companies Act 2006 and international
financial reporting standards adopted pursuant to Regulation (EC No
1606/2002) as it applies to the European Union.
The Group has not early adopted any standard, interpretation or
amendment that was issued but is not yet effective.
4. SIGNIFICANT JUDGEMENTS AND ESTIMATES
The preparation of the condensed interim financial information
requires management to make judgements, estimates and assumptions
that affect the application of accounting policies and the reported
amount of assets and liabilities, income and expense. Actual
results may differ from these estimates.
The significant judgements and estimates used in the application
of the Group's accounting policies are the same as those described
in the Group's Annual Report and Accounts for the year ended 31
December 2021.
5. SEGMENTAL REPORTING
For the purpose of IFRS 8, the chief operating decision maker
takes the form of the Board of Directors. The Directors' opinion is
that the business of the group is to provide cloud-based e-commerce
solutions. Based on this, there is one reportable segment. The
internal and external reporting is on a consolidated basis with
transactions between group companies eliminated on
consolidation.
HY2022 HY2021 FY 2021
(unaudited) (unaudited)
GBP'000 GBP'000 GBP'000
Revenue by type
SaaS 11,265 10,185 20,870
Services 930 956 1,993
Total Revenue 12,195 11,141 22,863
Cost of Sales by type
SaaS 3,042 2,193 4,880
Services 894 847 1,818
Total Cost of Sales 3,936 3,040 6,698
---------------------- ------------- ------------ -------
Gross profit 8,259 8,101 16,165
---------------------- ------------- ------------ -------
There is one customer which contributes 9%, which is GBP1.1m of
the Group's revenues (H1 2021: 1 customer - contributing
GBP1.0m).
The table below provides an analysis of the Group's revenue by
geographical market where the customer is based.
HY2022 HY2021 FY2021
(unaudited) (unaudited)
GBP'000 GBP'000 GBP'000
Geographical split of revenue
UK 5,972 5,149 10,537
France 2,484 2,496 5,058
Netherlands 1,218 1,251 2,492
Rest of Europe 1,381 1,543 3,126
Rest of the World 1,140 702 1,650
------------------------------ ------------- ------------ -------
Total Revenue 12,195 11,141 22,863
------------------------------ ------------- ------------ -------
6. EXCEPTIONAL ITEMS
The Group separately identifies those items which in
management's judgement, need to be disclosed by virtue of their
nature, size or incidence in order for the user to obtain a proper
understanding of the underlying performance of the business. The
exceptional costs of GBP257,000 (H1 2021: GBP264,000) relate to
severance costs and corporate activity. The exceptional costs in
2021 related to redundancies and additional costs relating from the
finalisation of the Early Birds acquisition.
7. TAXATION
The Group tax charge is based on the estimated annual effective
rate and for the half year is calculated at 19.00%, (HY2021:
19.00%) and applied to the loss before tax for the period.
8. LOSS PER SHARE
Basic Earnings per share is calculated by dividing the loss
attributable to the equity holders of the Company by the weighted
average number of ordinary shares outstanding in the period.
The calculation of continued earnings per share is based on the
following:
HY2022 HY2021 FY 2021
(unaudited) (unaudited)
GBP'000 GBP'000 GBP'000
Numerator
Loss for the period/year and loss used
in basic and diluted EPS (1,886) (1,423) (3,531)
Denominator
Weighted average number of shares used
in basic and diluted EPS 201,550,617 196,149,171 198,435,537
Loss per share - basic and diluted (0.9p) (0.7p) (1.8p)
The outstanding share options calculation are antidilutive, due
to loss made in the period. If they were to be included, the
weighted average number of shares would be 211,485,899 (H1 2021:
205,607,381) and the loss per share would be 0.9 pence (H1 2021:
0.7 pence).
9. INTANGIBLE ASSETS
Customer Existing Software
Goodwill Relationships Technology Trademark Development Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 1 January 2021 25,649 6,748 10,511 1,136 5,659 49,703
Additions - internally
developed - - - - 1,001 1,001
Foreign Exchange - - - - - -
At 30 June 2021 25,649 6,748 10,511 1,136 6,660 50,704
Additions - internally
developed - - - - 1,024 1,024
Acquired through asset
purchase - - 2,179 - - 2,179
Foreign Exchange - (49) - - (245) (294)
---------- -------------- ----------- ----------- ------------ -----------------
At 31 December 2021 25,649 6,699 12,690 1,136 7,439 53,613
Additions - internally
developed - - - - 955 955
Foreign Exchange - - - - 50 50
---------- -------------- ----------- ----------- ------------ -----------------
At 30 June 2022 25,649 6,699 12,690 1,136 8,444 54,618
---------- -------------- ----------- ----------- ------------ -----------------
Amortisation
At 1 January 21 - 1,956 3,270 356 3,536 9,118
Charge for the period - 328 537 57 668 1,590
At 30 June 21 - 2,284 3,807 413 4,204 10,708
Charge for the period - 328 818 57 661 1,864
Foreign Exchange - (22) - - (148) (170)
---------- -------------- ----------- ----------- ------------ -----------------
At 31 December 2021 - 2,590 4,625 470 4,717 12,402
Charge for the period - 328 738 57 809 1,932
At 30 June 2022 - 2,918 5,363 527 5,526 14,334
---------- -------------- ----------- ----------- ------------ -----------------
Net Book Value
At 30 June 2021 25,649 4,464 6,704 723 2,456 39,996
At 31 December 2021 25,649 4,109 8,065 666 2,722 41,211
---------- -------------- ----------- ----------- ------------ -----------------
At 30 June 2022 25,649 3,781 7,327 609 2,918 40,284
---------- -------------- ----------- ----------- ------------ -----------------
10. CASH AND CASH EQUIVALENTS
HY2022 HY2021 FY 2021
(unaudited) (unaudited)
GBP'000 GBP'000 GBP'000
Cash at bank 2,509 3,582 3,566
Bank loan (39) (60) (51)
2,470 3,522 3,515
------------- ------------ -------
11. SHARE CAPITAL
Allocated, called up and fully paid
Number of Shares Share capital Share Premium
GBP'000 GBP'000
Ordinary shares of GBP0.01 each
At 30 June 2021 196,149,171 1,961 53,251
---------------- ----------------------- -------------
Shares issued for cash during the year
Shares issued to sellers as part of
asset purchase and acquisition 5,401,446 55 2,229
---------------- ----------------------- -------------
At 31 December 2021 201,550,617 2,016 55,480
---------------- ----------------------- -------------
At 30 June 2022 201,550,617 2,016 55,480
================ ======================= =============
The Company issued 5,131,374 1p Ordinary shares at 42.5p on 26
July 2021 which related to 95% of the unpaid deferred consideration
to the sellers for the asset purchase of the Aleph software. The
Company issued 270,072 1p Ordinary shares at 37.50p on 7 October
2021 which was the remaining 5% of the deferred consideration to
the sellers for the purchase of the Aleph software. The Company has
a total of 201,550,617 ordinary shares in issue, all of which have
voting rights.
12. SHARE OPTIONS
During the six months ended 30 June 2022, the Group made further
grants under its existing share-based payment schemes, as
follows:
On 13 June 2022, the Company granted employees a total of
280,000 share options who had a year's service as at this date. The
options will vest based upon three years' service. Upon vesting,
the options will remain exercisable until 13 June 2032.
On 13 June 2022, the Company granted senior employees a total of
9,613,000 nil cost share options who had a year's service as at
this date. The options will vest based upon three years' service.
Upon vesting, the options will remain exercisable until 13 June
2032.
For the six months ended 30 June 2022, the total cost recognised
in the income statement was GBP175,000 (H1
2021: GBP141,000).
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END
IR FIFIIAIIAFIF
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September 29, 2022 02:00 ET (06:00 GMT)
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