TIDMACC
RNS Number : 7659Z
Access Intelligence PLC
16 January 2024
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with
the company's obligations under Article 17 of MAR.
Access Intelligence plc
("Access Intelligence", the "Group" or the "Company")
Trading Update
Access Intelligence (AIM: ACC), the technology innovator
delivering Software-as-a-Service (SaaS) solutions for the global
marketing and communications industries, is pleased to announce an
update on trading for the year ended 30 November 2023.
Year to 30 November 2023
During 2023, Access Intelligence focussed its efforts in two key
areas: the continued advancement of its market leading products
including the release of the Group's next generation platform into
the APAC region; and further refinement of the Group's operating
model to improve EBITDA margins and free cash flow conversion.
The Group's Annual Recurring Revenue ("ARR") increased by
GBP2.7m(1) in the period, demonstrating clear progress in growth
momentum across the Group when compared to flat year on year ARR(1)
in 2022. This growth was underpinned by both improved renewal rates
and new business win performance year on year.
Each region within the Group contributed to the ARR growth
during the year, with a strong turnaround being delivered in APAC
where the first ARR growth has been delivered since the acquisition
of Isentia. The Group's audience intelligence proposition is
resonating well where the combination of global media monitoring
and world class social listening has secured major new wins. In
addition the Group has seen a number of very encouraging winbacks
from competitors in the period as customers that had left Isentia
prior to its acquisition by Access Intelligence have now returned
to benefit from the Group's market-leading technology and
services.
ARR FY21 FY22 FY22 FY23 FY23
Change Change
EMEA & North America GBP26.9m +GBP2.5m GBP29.4m +GBP1.1m GBP30.5m
(Constant Currency)
--------- --------- --------- --------- ---------
EMEA & North America GBP26.9m +GBP2.5m GBP29.4m +GBP1.1m GBP30.5m
(Reported)
--------- --------- --------- --------- ---------
APAC GBP31.7m -GBP2.5m GBP29.2m +1.6m GBP30.8m
(Constant Currency)
--------- --------- --------- --------- ---------
APAC GBP32.0m -GBP1.4m GBP30.6m +0.2m GBP30.8m
(Reported)
--------- --------- --------- --------- ---------
Group GBP58.6m +GBP0.0m GBP58.6m +GBP2.7m GBP61.3m
(Constant Currency)
--------- --------- --------- --------- ---------
Group GBP58.9m +GBP1.1m GBP60.0m +GBP1.3m GBP61.3m
(Reported)
--------- --------- --------- --------- ---------
The Board expects total revenue for the financial year to be
approximately GBP62.4m (2022: GBP65.7m reported, GBP 63.9 m(1) ). A
clear focus on optimisation of the Group's operating model during
the year has helped the Group to deliver year on year Adjusted
EBITDA growth of 204%, and improvement in Adjusted EBITDA margin
from 3%(1) in 2022 to 11% in 2023. It is expected that Adjusted
EBITDA will be approximately GBP7.0m (2022: GBP2.3m reported, GBP
2.2 m(1) ), slightly ahead of consensus expectations(2) .
Overall headcount (FTE) was reduced as the Group's AI led
technology platform has enabled automation of some previously
manual services, improving overall client experience through
enhanced accuracy and speed of delivery, whilst duplicate roles
have been removed across the Group as the business has become more
globally integrated.
Net cash at 30 November 2023 was approximately GBP2.2m,
reflecting the additional non-recurring restructuring costs
incurred during the second half as part of the Group's effort to
optimise its overall cost base leading into 2024. A new GBP3.0m
financing facility has been put in place by the Group to provide
additional working capital headroom during 2024 as management
continues to focus on improving margins and cash generation.
Accelerating ARR growth in APAC
A strong turnaround has been delivered in the APAC region during
the year with first period of ARR growth since the acquisition of
Isentia being delivered during the first half (GBP0.3m) and an
acceleration in ARR growth during the second half (GBP1.3m). The
overall ARR growth of GBP1.6m for the year represents a GBP4.1m(1)
improvement compared to the prior year where ARR in APAC declined
by GBP2.5m(1) . The combination of Isentia's established media
monitoring and insights services in the region alongside Access
Intelligence's audience intelligence offering has led to a notable
improvement in renewal rates alongside much stronger new business
performance and winbacks against the competition across various
sectors, including government, finance and retail.
A focus on profitable, long-term customer contracts alongside a
reduction in one-off campaign revenue has led to recurring revenue
increasing to over 93% for the year in the region compared to less
than 90% in 2022.
New client wins and client winbacks in the APAC region during
the second half include: Bulgari, Chubb, Hyundai, Independent
Parliamentary Expenses Authority, Mazda, National University of
Singapore, New South Wales Government, Office of the Chief
Minister, Paramount (Channel 10), Queensland Rail, Services
Australia, Western Power, and University of Auckland.
Continued growth in EMEA & North America
Performance in Europe continues to remain on track with ARR and
margin both increasing year on year. The previously reported
slowdown in decision making at the Enterprise level in North
America has continued albeit a healthy pipeline of opportunities
continues to be developed in this market and a number of leading
global agencies including Havas and McCann have adopted our
combined audience intelligence proposition during the year. Overall
ARR growth in the EMEA & NA region for the year was
GBP1.1m.
New client wins in the EMEA & NA region during the second
half include: Brooklyn Museum, CBRE, Colt Technology, Driver and
Vehicle Standards Agency, Essar Group, Financial Conduct Authority,
GB Railfreight, Guardian Life, Kraft Heinz, Marie Curie, National
Grid, Natural History Museum, Phoenix Group, Royal College Of
Surgeons, Save The Children, Tesco, and UK Infrastructure Bank.
Overall ARR for the year across all regions increased by
GBP2.7m(1) (2022: GBP0.0m(1) ), resulting in a total ARR at 30
November 2023 of GBP61.3m (2022: GBP58.6m(1) ).
Outlook
In 2024 management will continue to focus on enhancing product
functionality for customers, building on the Group's market leading
audience intelligence proposition and driving further acceleration
in ARR growth across both the APAC and EMEA & North America
regions.
The introduction of the Group's next generation product into the
APAC market during 2023 has already created significant upsell and
cross-sell opportunities. This is expected to gain momentum in 2024
as additional features become available for customers.
In Europe, the Company also expects to see an increase in ARR
growth compared to 2023 whilst in North America, the Group's
streamlined team will continue to concentrate on a select number of
high value, high margin deals through developing enterprise
corporate accounts to improve long term ARR.
Enhancing operational efficiency to improve margins has been a
significant priority in 2023 and will continue to be a core focus
throughout 2024. As the Group continues to integrate global systems
more effectively, additional opportunities to realise margin
improvement and free cash flow generation are expected. The focus
on ensuring that the business operates from a lean cost base should
support further margin enhancement and positive cash flow during
2024 and beyond.
Christopher Satterthwaite, Non-Executive Chairman of the
Company, said:
"Access Intelligence's integrated audience intelligence
proposition is pioneering an innovative approach to marketing and
communications and has been adopted by leading global agencies who
forge strategies for the world's largest brands and
organisations.
In 2023, a notable acceleration in ARR growth and improved
Adjusted EBITDA margins has been delivered despite the challenges
posed by a difficult macro-economic environment. The turnaround in
the APAC region has been particularly remarkable, as the Group's
market leading products and services have been well-received by
existing, former and new customers. This growth in ARR in the year
provides confidence of revenue growth(1) being delivered during
2024.
The Board is pleased with the progress made during 2023 to
deliver profitable, global ARR growth and
remains confident about the opportunity for the Group to deliver
improved margins and free cash flow generation in 2024 and
beyond."
1 On a constant currency basis.
2 The Board understands that consensus expectations for the
Company's Adjusted EBITDA for 2023 is GBP6.7m.
For further information:
Access Intelligence plc 020 3426 4024
Joanna Arnold (CEO) / Mark Fautley (CFO)
Cavendish Capital Markets Limited (Nominated Adviser and
Broker)
020 7220 0500
Corporate Finance:
Marc Milmo / Fergus Sullivan
Corporate Broking:
Sunila de Silva
The Group's Nominated Adviser and Broker, finnCap Ltd, has now
changed its name to Cavendish Capital Markets Limited following
completion of its own corporate merger.
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END
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