0OPM Datalex Plc

Datalex plc 

Publication of 2023 Annual Report and Notice of Annual General Meeting

Return to revenue growth in 2023 as Datalex starts to rebuild market share in the airline technology market.

Dublin, Ireland, 20 June 2024: Datalex plc ("Datalex", the "Company" or the "Group") (Euronext Growth Dublin: DLE), a market leader in airline e-commerce solutions, announces that it has today published its Annual Report and Financial Statements for the year ended 31 December 2023 (FY 2023) and Notice of Annual General Meeting ("AGM").

(1)   Adjusted EBITDA is defined as earnings from operations before (i) interest income and interest expense, (ii) tax expense, (iii) depreciation and amortisation expense, (iv) share-based payments cost and (v) exceptional items

Commenting on today's announcement, Jonathan Rockett, Datalex CEO, said:

"In 2023, Datalex signed a number of long-term renewals with its existing customers that have set a solid foundation for future growth.

We are particularly pleased that as part of the renewal process, Aer Lingus, Edelweiss and Air China will be migrating to Datalex's newest platform products. These renewals, along with the related investment by these airlines to migrate to Datalex's latest product suite, are not only a testament to the value of our long-standing partnerships with customers, but also a vote of confidence in where Datalex is bringing its products over the next 3 - 5 years.

Additionally, Air Transat signed a new deal which includes a continuation of their existing product solutions combined with Datalex continuing to provide further capability to them over the partnership to enable them to achieve their growth strategy and retailing ambitions. JetBlue also extended its partnership with Datalex for the maintenance of existing services.

It is hugely positive that the Group has continued to sign new customers over the past 18 months. It is a validation of the solution that Datalex provides to the airline market and also proof of Datalex's ability to win in its market.

The renewals of key customer accounts in 2023 not only increased Datalex's recurring revenue base for the medium term, but also enabled the Group to move its customers to the Group's streamlined revenue model.

I have been really encouraged by the level of passion and commitment I have seen across the business since I joined in November 2023. The Datalex team is focused on delivering value to its customers. This is a significant strength, as 2024 will be another year where we remain focused on delivering activation and transformation projects for our customers. These projects will be another stepping stone for our turnaround leading to sustainable and long-term growth.

I am more excited than ever about Datalex's products and opportunities and look forward to working alongside my committed colleagues to maximise our potential into the future."

Key Financial & Performance Highlights

·      Revenue for FY 2023 increased year-on-year by 23% to US$28.9 million (2022: US$23.5 million).

·      Platform revenue of US$12.9 million increased year-on-year by US$1.8 million or 17%16 (2022: US$11.1 million). The increase is attributable to materially increased transaction volumes, most notably in Asia but also globally during the year.

·      Overall services revenue of US$14.1 million increased by 25% in 2023 (2022: US$11.2 million as a result of a strong year for new customer activation projects.

·      Other revenue of US$1.0m reflects revenue attributable to termination fees that will not carry forward into the next fiscal period.

·      Gross profit of US$9.7 million, reflecting a 52% year-on-year increase (2022: US$6.4 million), due to a combination of revenue growth and gross margin expansion. Gross margin of 34%, representing a 7-percentage point improvement year on year (2022: 27%). Gross margin expansion was due to higher margin activation work taking place in 2023, an increase in transaction revenues, and one-off termination fees.

·      Total operating costs before exceptional items in 2023 marginally increased to US$35.3 million (2022: US$35.0 million), primarily as a result of increased headcount costs to facilitate additional implementations and increased service revenue, offset by reduced amortisation of deferred fulfilment costs.

·      Adjusted EBITDA loss of US$2.9 million for 2023, an improvement of US$2.4 million compared to the prior year (2022: US$5.3 million).

·      Loss after tax for the Group for 2023 was US$9.0 million (2022: US$11.5 million), an improvement of US$2.5million.

·      Cash as at 31 December 2023 totalled US$5.8 million (2022: US$6.5 million). A net cash outflow from operations (US$6.9 million) and outflows to fund product development (US$1.4 million) were offset in part by proceeds of borrowings (US$8.6 million), contributing to a decrease in cash of US$0.8 million during the year.

Significant Corporate Developments

·      In 2023, partnership renewals were announced with Air China, Air Transat, JetBlue, Edelweiss and Aer Lingus, setting a solid foundation for future growth. Aer Lingus, Edelweiss and Air China will be migrating to Datalex's newest platform products.

·      In September 2023, Virgin Australia changed priorities with respect to its internal Next Generation Retail programme, impacting Datalex and several other vendors. Also during the year, SAS filed for chapter 11 bankruptcy in the US, resulting in them not proceeding with the Datalex NDC product. In 2023, we recognised revenue of US$3.5 million from these customers that will not be recurring revenue in 2024.

·      In 2023, we signed an agreement with LATAM Airlines. Although the project achieved its primary endpoints in June 2024, we have agreed that this solution will not be part of LATAM Airlines' or Datalex's short term priorities and will not proceed. We derived significant value and insight from this project and will continue to invest in co-innovation projects with airlines, where we see strategic areas of opportunity and a joint return on investment.

·      The activation project with easyJet continues to progress well, with easyJet going live with Datalex Merchandiser in December 2023, with further activations planned in 2024.

·      In December 2023, the Company announced a new partnership agreement with Air Macau to go-live with Datalex's new Shopping and Pricing product, evidencing its ability to remain innovative in a competitive landscape.

Balance Sheet Developments

·      During 2023, the Group secured an additional loan facility of €5 million from Tireragh Limited increasing the total loan facility to €15 million with a repayment date of 31 December 2024. At 31 December 2023, the Group had drawn down €13m from the Tireragh Limited loan facility.

·      The Board has continued its focus on positioning the business to repay the Tireragh Limited loan facility and is actively working with its financial advisors to advise on and commence an equity fundraising. If successful, it is intended that this funding will enable the Group to repay its existing loan facility with Tireragh Limited and provide sufficient working capital to invest further in the Group's product roadmap and activation projects, while continuing to compete for new revenue opportunities.

·      The Board has the support of Mr. Dermot Desmond, the Group's largest ultimate beneficial shareholder, who has confirmed to the Group that he will procure support for the planned equity fundraising. IIU Nominees Limited has also indicated its intention to apply for its pro rata entitlement of any fundraising.

·      Pending the above, the Company's lender Tireragh Limited, has informed the Group that, in the event that Datalex does not complete its planned equity fundraising, and subject to terms and conditions to be agreed, it will extend the termination date of the existing Tireragh Limited loan facility from 31 December 2024 to 1 July 2025, and provide a new loan facility in the amount of €10 million, if required, increasing the total facility to €25m.

2023 Results Presentation

Management will review the 2023 results on a webcast at 9am Dublin time on Thursday, 20 June 2024. The webcast will be available on our website at https://investors.datalex.com/reports-information/results-presentations.

Annual Report

Datalex's 2023 Annual Report and Financial Statements are available to view on www.datalex.com/investors and will shortly be available for inspection at http://www.rns-pdf.londonstockexchange.com/rns/1264T_1-2024-6-19.pdf 

AGM

The Company's AGM will be held on Thursday 18 July 2024 at 11.00 a.m. Dublin time at Block V, Eastpoint Business Park, Dublin 3 D03 H704, Ireland.

The Notice of AGM contains details of all resolutions to be proposed at the AGM. Any relevant updates regarding the AGM, including any changes to the arrangements outlined in the Notice will be announced via a Regulatory Information Service.

The Notice of AGM and a Form of Proxy will shortly be available on the Company's website and may be viewed and downloaded online at https://investors.datalex.com/shareholder-centre/shareholder-meetings. Hard copies of the Notice of AGM will be posted to shareholders who have elected to receive them.

ENDS

Contact information

Investor Enquiries

Neil McLoughlin, Datalex plc

+353 1 806 3500

investor.relations@datalex.com

Media Enquiries

Eavan Gannon, Powerscourt

+353 87 236 5973

Datalex@powerscourt-group.com  

About Datalex

Datalex's purpose is to transform airline retail. Datalex is a market leader in airline retail technology, offering unique products that enable airlines to drive revenue and profit as digital retailers. Datalex has a strong track record of delivering digital retail transformation for progressive airline brands worldwide. The Group is headquartered in Dublin, Ireland, and maintains offices across Europe, the USA and China. In 2023, Datalex was awarded the 'Great Place to Work®' and 'Best Workplaces in Tech™' certifications. Datalex plc is a publicly listed company, on Euronext Growth, Dublin.

Learn more at www.datalex.com