D4t4 Solutions Plc (AIM: D4T4) publishes the group’s audited Annual report and financial statements for the year ended 31 March 2018 which is available to view and download at http://www.d4t4solutions.com. A summary is provided below:
- The financial year recorded another strong year of profitable growth for the group and culminated in the signing of the two largest contracts in the group’s history – D4t4 has also witnessed the continuing evolution of its business into the data and analytics market space with a focus on growing the Celebrus software customer base and the group’s hybrid cloud data platform services
- D4t4 has also successfully achieved notable sales success in North America following its recent sales and marketing investment in the region
- During the period D4t4 have seen a shift in the mix of sales within the group. Firstly, through the growth in the demand for term or recurring licence sales of our Celebrus product set which had an impact on the perpetual licence sales that it has been used to in the past however, this has had the beneficial effect of increasing recurring revenue. Secondly, we have seen an increase in demand for our hybrid cloud data platform services which have developed well in the year particularly in the North American market
Key performance indicators Summary financials continuing operations (audited) Year ended Year ended Year on year 31 March 2018 31 March 2017 growth Revenue: Licence sales GBP 2.90m GBP 3.71m -21.82% Projects GBP 12.41m GBP 9.47m +31.06% Recurring income GBP 4.78m GBP 4.49m +6.53% Total revenue GBP 20.09m GBP 17.67m +13.71% Gross profit GBP 11.52m GBP 9.86m +16.74% GP margin 57.31% 55.82% +2.67% Profit before tax GBP 4.40m GBP 4.24m +3.72% Adjusted profit before tax* GBP 5.15m GBP 4.22m +22.04% Basic earnings per share 9.90p 10.49p -5.61% Adjusted diluted earnings per share 11.01p 9.97p +10.43% Unadjusted diluted earnings per share 9.49p 10.02p -5.33% Dividend for the period 2.50p 2.25p +11.11% Net current assets** GBP 7.08m GBP 5.55m +27.37%
*before amortisation of intangibles, share-based payments charges and foreign exchange gains
**reflects the increased level of trade debtors 2018 £19.53m (2017: £3.66m) due to the business weighting occurring late in the second half
Peter Kear, D4t4’s CEO commented:
“I am delighted to report a 13.71% increase in organic top-line growth with total revenues for the group rising to £20.09m. Importantly, we have been able to maintain our gross profit margins through a combination of product sales, our hybrid cloud data platform services business and our recurring revenue business, which has resulted in a 22% growth in underlying profitability yielding an adjusted pre-tax profit for the group of £5.15m.“
“Our strategy continues to deliver and is reflected in our strong profit growth. The business enters the new financial year in robust shape after achieving record bookings in the second half year under review – we are encouraged by the opportunities and outlook for the business in the coming year.“
D4t4 Solutions Plc
‘ALL ABOUT THE DATA‘
D4t4 Solutions Plc operates within the fast-growing data and analytics market. This market encompasses ‘big data’, artificial intelligence, machine learning and the business intelligence market; this market which has been estimated to be valued at U$150 billion by the global independent analyst International Data Corporation (IDC), with a projected growth of 11.9% annually until 2020 when the market is anticipated to be worth U$210 billion.
The business is focused on the finance and consumer sectors. The specific areas of focus for D4t4 are data and analytics related to the collection of data on how consumers interact with digital channels, the management and analysis of that data and the implementation of cost effective platforms to assist companies get real value from their data assets. Celebrus, our software product, is a customer data platform that is in a market, according to research by the Customer Data Platform Institute (CPDI), that is expected to grow from £300m in 2016 to £1bn in 2019.
We service clients in 21 countries.
Our people and intellectual property combine to create four core capabilities:
- Data capture software (Celebrus) and skills
- Data management facilities and skills
- Data analytics capabilities and solutions
- Data platforms that are on premise or in the cloud and combine hardware, software and services.
We are energetically focused on data platforms that enable clients who operate within the financial services, retail and consumer sectors to get the most from their data. From capture, through to management and analysis, we provide comprehensive products and services that drive value from our clients’ information assets.
We are accredited to ISO27001: Information Security Management and PCI Data Security Standard.
To find out more, visit http://www.d4t4solutions.com
The following information is a summary. To read the announcement in full go to http://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/D4T4/13693068.html
D4t4 Solutions Plc
‘ALL ABOUT THE DATA‘
“Our focus on providing the best real time data collection platform in the industry continues and this coupled with our private cloud data platform solutions leaves us well placed to take advantage of the market need for real time, accurate, customer data and finding better ways to analyse and use that data.”
“ Our clients operate in markets where in many cases the only differentiation that they have from their competitors is how well they understand and interact with their customers and how quickly they can capitalise on that customer interaction. All of which drives increasing demand for more scalable and cost-effective, compliant data collection and analytical platforms.”
Chief Executive Officer
Extracts from the CEO‘s report to shareholders:
D4t4 has continued to build upon our previously stated strategic objectives of “empowering our clients to gain significant value from their customer data and through this to deliver major uplifts in terms of their revenues and profitability.“
Vision and strategy
Our business vision is to earn high-margin, recurring revenues by creating the innovative data platform software and building the data platform solutions that financial services institutions and consumer focussed organisations need to power their artificial intelligence, advanced analytics, compliance, marketing and customer experience initiatives.
To deliver the vision our strategy is to focus our activity on two complementary areas that financial services and consumer organisations are investing in today and will continue to invest in for the foreseeable future:
- Increasing revenues derived from our customer data platform, Celebrus, generates high margin sales in the short-term as well as building a longer-term recurring revenue stream and creating more platform opportunities
- Generating recurring income through developing, deploying and managing ‘big data’ platforms that combine the services, software and hardware needed to help our clients get strategic advantage from their data by deploying artificial intelligence and advanced analytics
This strategy will be achieved by evolving our business based upon our core values of innovation, trust, collaboration and security and, by growing or enhancing the required core capabilities of data collection, data platforms, data management and data analytics.
Summary review of the 2017-2018 financial year
D4t4 has had another successful financial year. Our business has delivered revenues of £20.09 million (2017: £17.67m) a 13.71% increase on the previous year (this is an 18.5% increase in constant currency terms) and produced an adjusted profit before tax of £5.15m (2017: £4.22m). This solid growth has been driven by an increase in gross profit margin (GP) to 57.31% which was ahead of market expectations and the previous year (2017: 55.82%).
The group remains strongly cash generative however, due to the stronger second half weighting, net cash reserves were at £3.85m compared to £5.09 million the previous year, this therefore resulted in trade debtors being far higher than previous and finished at £19.53m (2017: £3.66m).
As we have indicated earlier, we have invested in our partner, sales and pre-sales teams, particularly in North America and EMEA, the outcome of which we are pleased to report is the winning of several significant major contracts with both new and existing clients. We have also invested in our partner-based sales strategy and, in 2018, we will continue to scale up these relationships which will pay rewards both this year and in the future.
During the last 12 months we have seen a shift in the mix of sales within the group; firstly, through the growth in the demand for term or recurring licence sales of our Celebrus product set which had an impact on the perpetual licence sales that we have been used to in the past but has had the beneficial effect of increasing our recurring revenue. Celebrus sales now represent 21.72% of group revenue; secondly, we have seen an increase in demand for our hybrid cloud analytics services which have developed well in the year particularly in the North American market. These combined with the ongoing development of our business to the more profitable data and analytics projects and associated recurring revenues has assisted in delivering the overall strong group profit level.
Our Projects business has had a strong year delivering an 31.06% increase in year-on year sales to £12.41 million, (2017: £9.47m). This robust performance over the previous year provides us with a good level of contract visibility into the immediate future. Recurring revenues from our managed private cloud data platform and software licence recurring revenue services business delivered income of £4.78 million (2017: £4.49m). As mentioned previously this steady growth in performance was due in part to the increase in our Celebrus annuity revenues during the year as more clients move to a term licence arrangement.
Gross profit in the period was £11.52m (2017: £9.86m) whilst profit before tax was £4.40m against £4.24m in 2017. Administration costs were £7.15m (2017: £5.63m). Therefore, reported profit from operations is £4.43m (2017: £4.29m) and adjusted profit for the year is £5.15m (2017: £4.22m) before tax. This includes a foreign exchange loss for the year of £0.40m (2017: £0.36m gain). Debtors grew from £4.27m to £20.54m due to timing of contracts. Cash and cash equivalents at 31March 2018 stood at £4.63m (2017: £6.29m), this as we said above reflects the increased level of trade debtors 2018 £19.53m (2017: £3.66m) due to the business weighting occurring late in the second half. Total net assets at the end of the year were £20.99m compared to £17.55m in March 2017. Adjusted fully diluted earnings per share grew 10.43% to 11.01 pence (2017: 9.97p), unadjusted diluted EPS was 9.49 pence (2017: 10.02 pence) down some 5.33%.
The group remains committed to a progressive dividend policy whilst balancing its investments for future growth. It is the Board’s intention to declare future dividends based on the overall performance, with appropriate cover in the range of 3-4 times.
The Board is recommending a final dividend of 1.875p, which, if approved by shareholders at the Annual General Meeting which is to be held on the 23 August 2018, will be paid on 14 September 2018 to Members on the Register at the close of business on 10 August 2018. The Ordinary shares become ex-dividend on 9 August 2018.
As documented in our trading update released in April during the last quarter of the year under review we signed two significant contracts which are also the biggest in our group’s history. From an income perspective one was recognised in March 2018 while the other will be recognised during the coming financial year. We have also recently delivered our first implementations of Celebrus as a Service, our cloud-based deployment, which bodes well for the future.
All of this exciting news and progress gives us an excellent start to the current year and, coupled with a growing opportunity pipeline and even greater cooperation with our growing list of business partners the Board remains confident in the future of the business and believes that it has a clear strategy in place to develop the opportunities that will deliver sustainable growth and enable us to achieve the ambitious plans for the year ahead.
The audited Annual report and financial statements for the year ended 31 March 2018 is available to view and download at http://www.d4t4solutions.com
SOURCE D4t4 Solutions Plc
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