TIDMIMO
RNS Number : 4625S
IMImobile PLC
09 July 2020
9 July 2020
IMImobile PLC
("IMImobile", the "Company" or "Group")
Q1 Trading Update
Following the full year trading update published 9 April 2020,
IMImobile (AIM: IMO), a leading cloud communications software and
solutions provider, is pleased to provide an update on Q1 FY21
trading, relating to the period 1 April 2020 through 30 June 2020
(the "Period").
Highlights
-- Resilient performance in the Period, with Group gross profit
up approximately 20% year-on-year
-- Cloud communications products year on year gross profit growth of over 30%
-- Positive momentum on strategic deployments and new contract wins
-- Financial position remains strong with net cash of GBP2m as
at 30 June 2020, following placing in April 2020
Performance update
Trading has been resilient during the Period, the Group's cloud
communications product set which represents almost 90% of the
Group's gross profit, delivered gross profit growth of over 30%
year-on-year. This growth was driven by the acquisition of
3Cinteractive Corp. in August 2019 and the existing cloud
communications products business which delivered gross profit in
line with the same period in the prior year despite the challenging
environment.
Volumes and activity levels in the Group's core sectors
including Banking, Mobile Operators and Logistics have counteracted
the sectors most adversely affected by the pandemic, notably
Healthcare, SMB and Retail. Encouragingly, the Company is now
seeing a steady recovery in these impacted sectors since late
May.
The Group has continued to operate at full capacity on
deployments that drive future recurring revenue streams. This has
been for a mixture of existing and new blue-chip clients looking to
accelerate their digital communication strategies. In addition, in
the UK, the Group has won a multi-year renewal tender with a major
broadcaster, gained new blue-chip clients in the utilities and
leisure sectors as well as helped major UK mobile operators to
enable free data for NHS workers.
Although the temporary suspension of hospital consultations and
routine operations has resulted in a significant reduction in
patient communication volumes, with a knock-on impact to healthcare
revenues in the short term, this sector continues to be very
important to the Group in the longer term. Pleasingly, significant
progress has been made during the Period with greater adoption of
the eClinic video consultation product, securing contracts with
flagship NHS Trusts and generating international interest in its
healthcare technology offering. The Group has, as a result,
invested in additional sales resources within this sector.
During the Period, the Group has also seen continued momentum
with the adoption of new communication channels by large
enterprises. It has launched Apple Business Chat with a leading UK
bank, completed its largest deployment for Rich Communications
Services (RCS) for a Brazilian mobile operator as well as launching
new WhatsApp Business services for a number of major automotive
brands. The Group continues to pioneer the adoption of new
communication channels in order to enhance and preserve its market
leading position.
Performance in North America, the largest addressable market for
the Group's product set, continues to be encouraging, with
significant opportunities identified for IMIconnect and the broader
customer interaction management suite. The Board is pleased that
new strategic deployments for large US retailers have continued
during the Period, with the projects remaining on track for launch
in Q2 FY21. The Company has also launched a new innovative
'curbside pickup' solution during the pandemic to enable customers
to limit contact with others when collecting goods and
services.
The Operator VAS (Value Added Service) and mobile payments
business, which now represents just over 10% of Group gross profit,
is continuing to experience significant structural decline as
expected by management.
Cost management and financial position
The decisive actions the Board took in April, notably reductions
in salaries and discretionary expenses, working from home and
raising new equity capital have been successful in mitigating much
of the impact and uncertainty of the initial shock of the pandemic,
whilst also allowing the Group to capitalise on market
opportunities.
In line with the increased confidence of the business, the
Company has begun to return furloughed employees to the business
and since 1 July, has returned all salaries, except those of the
Board, to normal levels. The Company will also review the repayment
of salary reductions based on its full year 2021 performance.
The Group's financial position remains strong with net cash of
GBP2m as at 30 June 2020.
Outlook
There is significant uncertainty around the economic impact of
the pandemic and, as a whole, the Group continues to be cautious.
However, we are reassured by the substantial opportunities open to
the Group and continue to invest in the core cloud communication
products, developing sales and marketing initiatives in North
America, establishing leadership in future messaging channels and
deepening our offering in the healthcare sector.
The results of the first quarter, together with a good
visibility of earnings, underpins the Company's confidence in
achieving good year-on-year gross profit growth, including organic
growth in the cloud communications products business, in the full
year to 31 March 2021.
In the longer term, we anticipate that the significant
disruption caused will drive and accelerate uptake of our leading
technology and services as large global enterprises increasingly
adopt digital transformation initiatives to improve customer
engagement strategies.
Notice of Results
The Company will announce its final results for the year ended
31 March 2020 on 28 July 2020.
Jay Patel, Group Chief Executive of IMImobile, commented:
"In addition to our high level of recurring revenue, our
diversified client base and evolving service offering have
underpinned the resilience of the business during this global
crisis. We continue to see signs of recovery in some of the sectors
more adversely impacted by the pandemic and, in addition to our new
customer wins and growing pipeline, remain excited about the
opportunities that a further acceleration of digital transformation
initiatives provides for the Group's future growth prospects. Our
priority remains to look after the long-term success of the
business, and I am very encouraged by how we have continued to
serve our customers, employees and shareholders."
This announcement is released by IMImobile PLC and contains
inside information for the purposes of Article 7 of the Market
Abuse Regulation (EU) 596/2014 (MAR), and is disclosed in
accordance with the Company's obligations under Article 17 of
MAR.
For the purposes of MAR and Article 2 of Commission Implementing
Regulation (EU) 2016/1055, the person responsible for releasing
this announcement is Mike Jefferies , Group CFO .
- ENDS -
For further information, please contact:
IMImobile PLC c/o Alma PR
Jay Patel, Group Chief Executive Officer
Mike Jefferies, Group Chief Financial
Officer
Alma PR Tel: +44 (0)20 3405
0205
Rebecca Sanders-Hewett IMImobile@almapr.co.uk
Susie Hudson
Harriet Jackson
Investec Bank - Nominated Adviser and Tel: +44 (0)20 7597
Joint Broker 5970
Henry Reast
Virginia Bull
Tejas Padalkar
N+1 Singer - Joint Broker Tel: +44 (0)20 7496
3000
Tom Salvesen
Justin McKeegan
Iqra Amin
About IMImobile PLC
IMImobile is a communications software provider whose solutions
enable enterprises to automate digital customer communications and
interactions to improve customer experience and reduce operating
costs.
IMImobile's enterprise cloud communications software platform
orchestrates customer interactions, connecting existing business
systems with digital communications channels. Organisations that
trust us to deliver smarter digital customer engagement include
Hermes, Centrica, AA, O2, EE, BT, Walgreens, Tracfone, Ooredoo,
Best Buy, Express, three of the major retail banks in the UK and
public-sector organisations globally.
IMImobile is headquartered in London with offices across the UK,
Hyderabad, Toronto, Boca Raton, Dubai and Johannesburg and has over
1,100 employees worldwide. IMImobile is quoted on the London Stock
Exchange's AIM market with the TIDM code IMO.
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END
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