Confirmed €50m CARR Guidance for Full
Year
Cost Base for 2024 to Be Lower than in 2023
Despite Growth
Monthly Cash EBITDA Positive Starting from
End of Q3 2024
Regulatory News:
MotorK plc (AMS: MTRK) (“MotorK”, the “Group” or
the “Company”), a leading SaaS provider to the automotive
retail industry in the EMEA region, announced today its results for
the first six months of the year ended June 30, 2024 (“H1
24”).
H1 24 FINANCIAL HIGHLIGHTS
- Cash EBITDA Positive: starting from the end of Q3, we
are on track to achieve positive Cash EBITDA on a monthly basis,
marking a significant milestone in our financial performance.
- Cost Efficiency: we have successfully managed our cost
base, ensuring it remains lower than in 2023 despite our growth
initiatives. This efficient cost management will help us sustain
profitability in the long term.
- Adjusted EBITDA: stands at €1.6 million, a substantial
improvement compared to the negative €1.4 million in the first six
months of FY 2023. This turnaround reflects our successful efforts
to drive profitability.
- Q2 24 Committed ARR (“CARR”): €39.6 million, a 14%
growth year-on-year, below budget due to longer sales cycle on some
significant deals still expected to close before year end.
- Recurring Billings: amounted to €17 million, up 19% year
on year, and representing 79% of total revenues, demonstrating
continued improvement in the revenue mix and the growing reliance
on recurring income streams.
- Acquired Businesses Migration: continuous progress in
migrating, upselling and cross-selling of acquired services, with a
view to complete migration of four services onto MotorK product
suite by end of H1 2025, as MotorK continues to reach synergies and
prepare for new additional acquisitions.
- Pipeline: largest pipeline of opportunities in the
Company’s history, providing growth visibility for H2 24, with
€10.0m in Retail and €12.6m in Enterprise.
- Net Borrowing Position: our net borrowing position
improved to -€16.6 million, compared to -€21.3 million in December
2023. This positive change is attributed to a Reserved Capital
Increase of €14 million, net of free cash flow, exceptional items,
and interest paid during the period.
Amir Rosentuler, Executive Chairman, commented: "I am
delighted to share the results of the first half of 2024. We have
effectively capitalized on our positive commercial momentum while
streamlining operations and leveraging synergies across our
business. This strategic focus has not only put us on the path to
achieving our profitability goals but also ensured that our growth
trajectory remains robust. MotorK's performance underscores our
resilience and competitiveness in the European market. We remain
unwavering in our commitment to growth, efficiency, and delivering
exceptional value to our stakeholders. We are confident in our
ability to meet our full-year targets."
STRATEGIC FOCUS ON PROFITABILITY
While FY 23 was marked by ambitious growth plans necessitating
strategic investments in workforce and expanded overheads due to
M&A integrations impacting short-term profitability, MotorK
entered 2024 with a firm commitment to achieve cash EBITDA
profitability. A comparison of the first half of the year with the
same period in 2023, highlights significant achievements in this
direction. As planned, the related beneficial long-term effects
started to materialize in the first half of the current year. In
addition, a focused effort on optimizing operations, reallocating
resources, and activating synergies across multiple countries and
departments led MotorK to successfully reach a turning point. The
full-time equivalent (FTE) count decreased by 14% from 466 last
year to 399, and translated into €2.3 million savings on total
personnel costs. This, along with additional streamlining efforts,
contributed to reducing the Group’s total operating cost base by
14% compared to H1 2023, from €23.3 million to €19.9 million. As a
result, the adjusted EBITDA for the period increased to €1.6
million, compared to -€1.4 million in 2023, while the cash EBITDA
raised to -€3.3 million compared to -€9.3 million in June last
year. These achievements demonstrate the Group's capability to
reduce the cost base without compromising the growth goals, leading
to significant improvements over the original budget and unlocking
additional infrastructure cost savings toward the end of the
year.
OPERATIONAL HIGHLIGHTS
In the first six months of 2024, the Group recorded solid
Committed ARR growth to €39.6 million, a 14% uplift compared to the
same period last year.
The increased focus on Enterprise segment, now accounting for
21% of the ARR (17% in H1 23), underlines the Company’s ability to
meet the specific OEM need for an innovative comprehensively
integrated partner capable of dealing with complex multi-country
projects, and to successfully implement retention strategies to
generate more value. This is evident in MotorK’s 116.6% NRR
(compared to 115.3% last year), the healthy €205 thousand ACV (up
6% year-on-year) and low churn rate of 4.2%. Due to the longer
sales cycle intrinsic to the Enterprise segment, a handful of high
ARR deals have experienced slight delays, pushing their signing to
the second half of the year.
The management team is confident that these negotiations will be
finalized in the upcoming months. For this reason, and factoring a
€13.5 million pipeline visibility for the segment, the expectations
for the second part of the year are in line with the CARR
guidelines.
The Retail segment demonstrated resilience and strategic
progress with overall NRR of 109%, underpinned by a stable low
churn rate of 6.6%. These healthy retention metrics kept the
positive ACV momentum going, translating into a high segment ACV of
€19.8k.
As of June 2024, the Company benefits from a Retail Pipeline
valued at €10 million and an Enterprise Pipeline valued at €12.6
million, representing a record high. Combined with a committed
Annual Recurring Revenue (CRR) of €4.2 million, this provides
strong visibility for the second half of 2024.
OUTLOOK
Looking ahead to the second half of the year, MotorK is building
positive momentum in FY24, confirming the initial CARR guideline of
€50 million. Emphasizing its strategic shift towards a more
Enterprise-focused revenue mix, the Group benefits from a robust
pipeline of opportunities as of H1 24 and anticipates another
high-performing end of the year. Given this outlook, MotorK is
confident of meeting its booking targets.
In terms of Cash EBITDA, the focus on optimizing the
organizational structure and activating cost synergies across
departments exceeded expectations, positioning the company for
long-term efficiency and growth. Considering the slight delays of
some large contracts initially forecasted to materialize in the
first half of the year, profitability guidance has been slightly
revised. MotorK is confident in achieving a positive Cash EBITDA on
a monthly basis starting from the end of Q3.
With a strategic focus on profitability and a robust growth
plan, MotorK is well-positioned to capitalize on opportunities and
deliver value to its customers in the dynamic digital automotive
retail market.
NEXT PUBLICATION: Q3 24 TRADING UPDATE, 24 OCTOBER
2024
H1 2024 CONSOLIDATED PROFIT AND LOSS
In k€
Jun-24
Jun-23
Revenues
21,464
21,900
Costs for customers media services
(4,034)
(3,634)
Personnel costs
(13,854)
(16,111)
R&D capitalization
4,859
4,714
Other costs
(6,868)
(8,236)
EBITDA Adjusted
1,567
(1,367)
Extraordinary costs
(1,097)
(1,346)
Stock Option Plan costs
(573)
(668)
EBITDA
(103)
(3,381)
Depreciation & Amortization
(5,133)
(3,869)
EBIT
(5,236)
(7,250)
Finance costs (net of finance income)
(1,129)
(487)
Profit/(Loss) before tax
(6,365)
(7,737)
Corporate income tax
(118)
(62)
Profit/(Loss) for the period
(6,483)
(7,799)
H1 2024 CASH FLOW STATEMENT
In k€
Jun-24
Jun-23
Cash - Beginning of the period
3,509
19,223
EBITDA Adjusted
1,567
(1,367)
Decrease / (increase) in working capital
(4,163)
(625)
Decrease / (increase) in contract assets
34
(2,741)
Operating free cash-flow
(2,562)
(4,733)
Taxes paid
104
(384)
Cash flow from investing activities - tangible assets
(3)
(86)
Cash flow from investing activities - R&D
(4,880)
(4,731)
Free cash-flow
(7,341)
(9,934)
Exceptional items
(897)
(613)
Cash-flow from investing activities - M&A
(4,302)
(3,339)
Cash-flow from financing activities
2,122
(1,005)
Cash flow from equity movements
14,095
766
Others
(83)
367
Net increase / (decrease) in cash
3,594
(13,758)
Cash - End of the period
7,103
5,465
H1 2024 STATEMENT OF FINANCIAL POSITION
In k€
Jun-24
Dec-23
Tangible assets
3,827
4,557
Intangible assets
46,939
46,477
Investment in associates companies
3,538
3,538
Fixed assets
54,304
54,572
Contract assets
24,814
24,848
Net working capital
1,545
(2,248)
Deferred tax liabilities
(1,654)
(1,791)
Employees benefit liabilities
(2,359)
(2,309)
Provisions
(92)
(177)
Total invested capital
76,558
72,895
Cash and cash equivalents
7,103
3,509
Financial assets
324
234
Financial liabilities
(24,082)
(25,009)
Net borrowing position
(16,655)
(21,266)
Net equity
59,903
51,629
H1 2024 REVENUES BY PRODUCT AND SERVICES LINE
In k€
Jun-24
Jun-23
y.o.y. change
SaaS platform
16,091
16,243
(1%)
Digital Marketing
4,559
3,704
23%
Other
814
1,953
(58%)
Revenues
21,464
21,900
(2%)
H1 2024 SAAS PLATFORM REVENUES
In k€
Jun-24
Jun-23
y.o.y. change
Recurring revenue
16,004
16,125
(1%)
Contract start-up revenue
87
118
(26%)
SaaS platform revenues
16,091
16,243
(1%)
% Recurring on Revenues
75%
74%
1%
% SaaS platform on Revenues
75%
74%
1%
H1 2024 REVENUES BY GEOGRAPHY
In k€
Jun-24
Jun-23
y.o.y. change
Italy
13,232
13,335
(1%)
Spain
1,980
2,865
(31%)
France
3,429
2,382
44%
Germany
1,323
1,974
(33%)
Benelux
1,500
1,344
12%
Revenues by geography
21,464
21,900
(2%)
Forward-looking information and disclaimer
This press release may include forward-looking statements. Other
than reported financial results and historical information, all
statements included in this press release, including, without
limitation, those regarding our financial position, business
strategy and management plans and objectives for future operations,
may be deemed to be forward-looking statements. Without limitation,
any statements preceded or followed by or that include the words
“targets”, “plans”, “believes”, “expects”, “aims”, “intends”,
“anticipates”, “estimates”, “projects”, “will”, “may”, “would”,
“could” or “should”, or words or terms of similar substance or the
negative thereof, are forward-looking statements. These
forward-looking statements are based on our current expectations,
projections and key assumptions about future events and are subject
to risks and uncertainties that could cause actual results to
differ materially from those expressed in the forward-looking
statements. Many of these risks and uncertainties relate to factors
that are beyond MotorK’s ability to control or estimate precisely,
such as future market conditions, the behavior of other market
participants and the actions of governmental regulators. Readers
are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this press release
and are subject to change without notice. Other than as required by
applicable law or the applicable rules of any exchange on which our
securities may be traded, we expressly disclaim any obligation or
undertaking to update or revise publicly any forward-looking
statements, whether because of new information, future events or
otherwise.
Important information
This press release contains information within the meaning of
Article 7(1) of the Market Abuse Regulation (596/2014).
ABOUT MOTORK PLC
MotorK (AMS: MTRK) is a leading software as a service (“SaaS”)
provider for the automotive retail industry in the EMEA region,
with nearly 400 employees and twelve offices in eight countries
(Italy, Spain, France, Germany, Portugal, Belgium, the UK, and
Israel). MotorK empowers car manufacturers and dealers to improve
their customer experience through a broad suite of fully integrated
digital products and services. MotorK provides its customers with
an innovative combination of digital solutions, SaaS cloud products
and the largest R&D department in the automotive digital sales
and marketing industry in Europe. MotorK is a company registered in
England and Wales. Registered office: 5th Floor One New Change,
London, England, EC4M 9AF - Company Registration: 9259000. For more
information: www.motork.io or investors.motork.io.
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FOR FURTHER INFORMATION MotorK Investor Relations Boaz
Zilberman boaz.zilberman@motork.io +972 532 819 810