TIDMRDT
RNS Number : 5258M
Rosslyn Data Technologies PLC
17 September 2019
17 September 2019
Rosslyn Data Technologies plc
("Rosslyn", "RDT" or the "Company")
Audited Results
For the year ended 30 April 2019
Rosslyn Data Technologies plc (AIM: RDT), the provider of a
leading cloud-based enterprise data analytics platform, is pleased
to announce its audited results for the year ended 30 April
2019.
Financial Summary
-- Revenue growth of 8.3% to GBP7.0m (2018: GBP6.4m).
-- Annual licence fee revenue growth of 9.2% to GBP5.4m (2018: GBP5.0m).
-- Operating EBITDA (excluding share-based costs) improved by
75% to a loss of GBP432,000 (2018: loss of GBP1.8m).
-- Cash generated from operations of GBP220,000 (2018: cash used in operations of GBP3.45m).
-- Cash balance at the year-end of GBP2.0m (2018: GBP0.3m),
after securing a GBP1.5m term loan from Clydesdale Bank, of which
GBP1.0 million had been drawn down at year end. Net cash of
GBP373,000 (2018: net debt of GBP757,000).
-- Administrative expenses reduced by over 10% to GBP6.0m (2018: GBP6.9m).
Operational Highlights
-- Year of consolidation allowing us to accelerate growth in the coming years from a sound base.
-- Significant investment into product development to broaden
out the RAPid product offering, adding new tools and
functionality.
-- Integrating functionality from the Integritie product suite
into our new supplier information management suite (SIM).
-- Secured high value contracts in various sectors including
international logistics, civil defence, healthcare and
pharmaceuticals, illustrating the broad appeal of our offering
across the supply chain to chief procurement officers and chief
financial officers in a wide range of sectors.
-- Reduced cost base during the year through implementation of
efficiencies in product development.
Rosslyn Chief Executive Officer, Roger Bullen said;
"Our work in 2019 has laid a solid foundation from which to grow
the business further. We are confident of continued growth as we
engage in numerous large client opportunities that we hope to be
able to announce later this year."
Chairman's statement
Strategy and operations
Following the integration of Integritie in April 2017, last year
has been one of consolidation, resulting in investment in product
development, further reducing costs, and winning larger value
contracts with a broader product offering. Moreover, we were
pleased to have achieved a key milestone, with the Group having
generated cash from operations for the first time since IPO.
The Integritie acquisition brought us additional functionality
which has been fully integrated into the Rosslyn platform. We have
also invested in new product development features to add tools to
broaden out the RAPid product suite. These improvements will allow
us to provide greater value to clients by being more embedded into
their systems and processes. We have a product suite that we
believe makes a material difference to our clients' operations.
Our cost base reduced during the year as we made technological
efficiencies in our product development and client delivery
processes which allowed us to use resources more effectively. We
will continue to manage our costs tightly in line with our revenue
growth. Our direct competitors are often larger and better funded
than us and so we need to ensure that the message of the strength
of our product is conveyed forcefully.
Despite stiff competition, during the year we secured numerous
high value contracts in various sectors including international
logistics, civil defence, healthcare and pharma. This illustrates
the broad appeal of our offering across the supply chain to chief
procurement officers and chief financial officers in a wide range
of sectors.
We were pleased to have achieved a key milestone, with the Group
having generated cash from operations for the first time since IPO.
In March we secured bank debt with Clydesdale Bank in the form of a
term loan, and this together with our cash balance puts us on a
strong footing to continue to invest in growth. Moreover, being
recognised as a bankable company by an institution such as
Clydesdale, demonstrates confidence in Rosslyn as a maturing
business as it prepares for future growth.
We have strengthened the Board through the addition of Ash Mehta
as Chief Financial Officer in April, and Ginny Warr as
Non-Executive Director in May. I took over as Chairman last October
and our previous Chairman, John O'Hara, stayed with Rosslyn to
assist the transition before stepping down in June. We are
extremely grateful to John for his nine years of dedicated service
to Rosslyn and wish him well for the future.
Outlook
We expect this year to be one in which we generate positive
operating cash flow allowing us to fund further investment into
products and sales channels. To this end, we will continue to
manage costs tightly and appropriately in line with the level of
new sales wins.
The Group is in discussions regarding contracts with additional
high value blue-chip targets which would provide upside to the
Group. These larger deals take longer to negotiate due to more
decision makers being involved in our client organisations. This
coupled with the current global economic uncertainty and political
uncertainty in the UK means their execution timing can be harder to
predict. However, we continue to win new clients, including a large
new client in the science-led sustainable technologies sector.
Therefore, even though it has been a slower start to the first few
months of our new financial year than we had hoped, we are
confident in achieving a positive outcome for the year.
The strategy continues as before, namely to grow the product
offering and client base in the supplier analytics space whilst
seeking acquisition opportunities to increase our scale and
offering.
With a strengthened Board, cash resources, a focused team and an
advanced suite of products to address a market in need of data
analytics, the Group is well positioned for growth. I look forward
to updating you on progress further later this year.
Chief Executive's statement
Strategy
This year, we continued with our strategic plan, which is to
focus on ensuring the success of our customers and partners by
providing them with world-class data-led solutions and business
insights that deliver significant and sustainable business value.
The demand for our software solutions has been high from enterprise
organisations, both end-user customers and partners around the
world.
Operations
During the year, we have made new investments to integrate and
further develop our suite of solutions and products on the RAPid
platform, adding new tools and capabilities, whilst ensuring the
platform and solutions are more efficient, scalable and user
friendly. For example, we have capitalised on market demand and
focused our software development on the supply chain market,
introducing a complete supplier management solution including
supplier onboarding, supplier performance management, and contract
and document handling.
Moreover, we have introduced new technologies based on robotic
process automation (RPA), alongside our integrated Neuro
Linguistics Programming (NLP) and artificial intelligence. These
technologies have enabled us to fully automate processes covering
scheduling, extraction, transformation, load, enrichment,
classification, and visualisation of spend data, as well as
generate error reporting without any human intervention. We believe
this to be a first in the market and a true differentiator against
our competitors.
As well as contributing to better client servicing, these
efficiencies have also allowed us to reduce internal costs to bring
us closer to a positive EBITDA.
These developments demonstrate the versatility of our platform,
which gives the user the ability to move from one view of a
supplier to the next seamlessly. The improved platform enables our
clients to achieve a holistic view of their enterprise data, as
they are now able to manage documents, supplier performance,
onboarding and other solutions from one easy to access place.
The improvements also allow Rosslyn to use the underlying
features to enter adjacent markets which could use similar
functionality.
Through our strong relationship with Microsoft and as a heavy
user of their Azure cloud services we ensure that our flagship
RAPid product remains at the cutting edge of technological
development, enabling scale and efficiencies to be achieved at the
lowest possible cost. Microsoft continues to recognise RAPid as one
of the top cloud-based platforms in the market and also recognises
Rosslyn as a preferred partner, issuing us with its "Co-Sell
Recommended Partner" status, a significant achievement for us.
Data security remains at the forefront of our deliverables, and
we are seeing our clients interested in migrating to their own
cloud solutions, requesting our service be included in their cloud
"stack" for reasons of data security. This has provided us with new
opportunities; we have developed our system to be capable of being
containerised and portable from one cloud solution to another. This
allows security teams to comply with their company policies and
puts us ahead of our competition in terms of flexibility.
Through our direct sales team, we have signed a number of new
contracts during the year, notably with major global businesses
headquartered in Northern Europe. These clients continue to
increase in number and value as we drive to uplift our annual
recurring revenue and our overall average contract values. The new
clients have contributed to our highly diversified and complex
client base and provide us with excellent opportunities to
demonstrate the scalability, value and efficiency of the RAPid
platform to our partners and clients.
Whilst the majority of revenues still come from our Direct Sales
team, we continue to seek traction through our partnership
strategy. We have signed a number of new partnership agreements and
continue to roll this programme out around the world.
We are now also seeing developments in the market that enable us
to expand our offerings to include services covering compliance,
logistics, complaints, workflow management, risk, corporate social
responsibility and workforce management, all adjacent to the supply
chain. We are excited about these new opportunities and our growing
capabilities to help clients improve revenue generation,
profitability and business efficiencies with us. In the year ahead
it is our intention to add to the sales and business development
teams as necessary to fulfil the Company's growth ambitions. We
have been able to streamline development processes, which has led
to an overall decrease in the number of employees compared to
previous years. This ensures we are more balanced as a Company with
more sales resource to achieve our growth objectives.
Our staff have positively contributed to our growth. The two
teams of Integritie and Rosslyn are now a single team and we have
worked to develop a supportive culture with open communication in
which employees are empowered to propose and implement
improvements. We are also working to foster closer working between
our Sales team and Development team to better identify client needs
and incorporate them into our product development plan.
Outlook
In summary, we are seeing the benefits from the investments that
we have made. Our solutions and products are becoming extremely
well known and recognised for innovation, and we have a strong
unified team of people driving our growth. I would like to join
James Appleby and the Board in thanking our employees and
shareholders, without whom none of this would be possible. I look
forward with confidence to the 2019-20 financial year.
Financial performance
Revenue
We adopted IFRS 15 a year early last year and so the results
shown for the current and prior year are both shown on that basis,
without restatement. Revenue for the year grew 8.3% to GBP7.0m
(2018: GBP6.4m). Underlying annual licence fee revenue showed
growth of 9.2% to GBP5.4m (2018: GBP5.0m). This growth was
underpinned by sales of RAPid to large clients in sectors such as
international logistics, civil defence, healthcare and
pharmaceuticals.
Gross margin
The gross margin percentage increased to 79.7% (2018: 76.1%) as
we worked hard to reduce our cloud storage and processing costs
through more efficient utilisation of this resource.
EBITDA
The increase in revenues and gross margin percentage, coupled
with administrative expenses being reduced by 12.6% to GBP6.0m
(2018: GBP6.9m), has resulted in an EBITDA (excluding share-based
costs) improved by 76% to a loss of GBP432,000 (2018: loss of
GBP1.8m).
Research and development
We continue to invest significantly into research and
development for our product range. During the year the Group spent
GBP1.1m (2018: GBP0.7m) on tax relief qualifying research and
development in order to broaden out the RAPid product offering,
adding new tools and functionality and also fully integrating
functionality from the Integritie product suite. These costs are
expensed fully as they are incurred and excluding this investment
Operating EBITDA would have been a profit of GBP0.7m (2018: loss of
GBP0.7m).
Loss before income tax
The loss before income tax for the year was GBP1.7m (2018:
GBP3.7m). This includes the impact of GBP1.0m (2018: GBP1.0m) of
amortisation of intangible assets arising from the Integritie
acquisition in 2017.
Cash flow and funds
The cash balance at the year-end was GBP2.0m (2018: GBP0.3m).
During the year we secured a GBP1.5m term loan from Clydesdale Bank
of which GBP1.0m had been drawn down at the year end. Part of this
drawdown was used in April and May 2019 to repay loan notes taken
on in the acquisition of Integritie totalling GBP134,000 and
GBP626,000 respectively. Most importantly, for the first time since
IPO the Group generated cash from operations.
Financial results
Consolidated statement of comprehensive income
Year ended Year ended
30 April 30 April
2019 2018
Note GBP'000 GBP'000
------------------------------ ---- ----------- ----------
Revenue 3 6,965 6,433
Cost of sales (1,416) (1,538)
------------------------------ ---- ----------- ----------
Gross profit 5,549 4,895
Administrative expenses (5,993) (6,861)
Depreciation and amortisation (1,041) (1,064)
Share-based payments (125) (194)
Impairment of goodwill - (364)
------------------------------ ---- ----------- ----------
Operating loss (1,610) (3,588)
Finance income 1 -
Finance costs (87) (101)
------------------------------ ---- ----------- ----------
Loss before income tax (1,696) (3,689)
Income tax 595 478
------------------------------ ---- ----------- ----------
Loss for the year (1,101) (3,211)
Other comprehensive income (27) (23)
------------------------------ ---- ----------- ----------
Total comprehensive income (1,128) (3,234)
------------------------------ ---- ----------- ----------
Loss per share
Basic and diluted loss per share: Pence Pence
ordinary shareholders 0.57 1.76
Consolidated statement of financial position
30 April 30 April
2019 2018
GBP'000 GBP'000
------------------------------ -------- --------
Assets
Non-current assets
Intangible assets 2,946 3,969
Property, plant and equipment 14 23
------------------------------- -------- --------
2,960 3,992
------------------------------ -------- --------
Current assets
Trade and other receivables 1,697 2,150
Corporation tax receivable 363 557
Cash and cash equivalents 1,960 317
------------------------------- -------- --------
4,020 3,024
------------------------------ -------- --------
Total assets 6,980 7,016
------------------------------- -------- --------
Liabilities
Non-current liabilities
Trade and other payables (126) (91)
Deferred tax (218) (291)
Financial liabilities -
borrowings (653) (744)
------------------------------- -------- --------
(997) (1,126)
------------------------------ -------- --------
Current liabilities
Trade and other payables (4,018) (3,771)
Financial liabilities -
borrowings (934) (330)
------------------------------- -------- --------
(4,952) (4,101)
------------------------------ -------- --------
Total liabilities (5,949) (5,227)
------------------------------- -------- --------
Net assets 1,031 1,789
------------------------------- -------- --------
Equity
Called up share capital 963 941
Share premium 12,777 12,555
Share-based payment reserve 515 390
Accumulated loss (18,241) (17,140)
Translation reserve (116) (90)
Merger reserve 5,133 5,133
------------------------------- -------- --------
Total equity 1,031 1,789
------------------------------- -------- --------
Consolidated statement of cash flows
Year ended Year ended
30 April 30 April
2019 2018
GBP'000 GBP'000
-------------------------------------- ----------- ----------
Cash flows used in operating
activities
Cash generated/(used) in operations 220 (3,450)
Finance income 1 -
Finance costs (87) (95)
Corporation tax received 716 474
Other comprehensive income - (23)
--------------------------------------- ----------- ----------
Net cash generated/(used) in
operating activities 850 (3,094)
--------------------------------------- ----------- ----------
Cash flows used in investing
activities
Purchase of property, plant
and equipment (10) (19)
Acquisition of subsidiaries - (1,188)
--------------------------------------- ----------- ----------
Net cash used in investing activities (10) (1,207)
--------------------------------------- ----------- ----------
Cash flows generated from financing
activities
New loans in year 1,000 278
Repayment of borrowings (441) (544)
Proceeds from share issuance 250 5,056
Costs of share issuance (6) (457)
--------------------------------------- ----------- ----------
Net cash generated from financing
activities 803 4,333
--------------------------------------- ----------- ----------
Net increase in cash and cash
equivalents 1,643 32
Cash and cash equivalents at
beginning of year 317 285
--------------------------------------- ----------- ----------
Cash and cash equivalents at
end of year 1,960 317
--------------------------------------- ----------- ----------
Reconciliation of loss before income tax to cash used in
operations
Year ended Year ended
30 April 30 April
2019 2018
GBP'000 GBP'000
------------------------------------------ ----------- ----------
Loss before income tax (1,696) (3,689)
Depreciation, amortisation and impairment
charges 1,041 1,427
Share-based payment transactions 125 195
Costs to acquire subsidiary - 151
Finance income (1) -
Finance costs 87 101
------------------------------------------ ----------- ----------
(444) (1,815)
Decrease in trade and other receivables 453 970
Increase in trade and other payables 211 (2,605)
------------------------------------------ ----------- ----------
Cash generated/(used) in operations 220 (3,450)
------------------------------------------ ----------- ----------
Notes to the consolidated financial statements
1. General information
Rosslyn Data Technologies plc (the "Company") is a company
domiciled in the UK. The address of the registered office is 60 St.
Martin's Lane, Covent Garden, London WC2N 4JS. The Company is the
ultimate parent company of Rosslyn Analytics Ltd and Rosslyn Data
Management Ltd, companies incorporated in the UK, and the ultimate
parent company of Rosslyn Analytics, Inc., a company incorporated
in the United States of America (collectively, the "Group"). The
Group's principal activity is the provision of data analytics using
a proprietary form, data capture, data mining and workflow
management.
2. Accounting policies
Basis of preparation
The Group's consolidated financial statements have been prepared
and approved by the Directors in accordance with International
Financial Reporting Standards (as adopted by the EU) and IFRIC
interpretations and with those parts of the Companies Act 2006
applicable to companies reporting under IFRS. The financial
statements have been prepared under the historical cost
convention.
Going concern
Notwithstanding that the Group has made losses in the current
year, these financial statements have been prepared on the going
concern basis, which assumes that the Group will continue to be
able to meet its liabilities as they fall due for the foreseeable
future.
The Directors have prepared cash flow statements for the periods
to 30 April 2021 to ensure going concern criteria are met. Provided
the Group achieves its forecasts for the forthcoming year, the
Group will be able to pay its employees and suppliers and be in a
cash positive position. Should the Group fall short of its revenue
forecast it will need to reduce costs accordingly to maintain cash
balance.
Having considered the forecasts and scenario actions for any
downturn, the Directors have a reasonable expectation that the
Group has adequate resources to continue in operational existence
for the foreseeable future. For these reasons, they continue to
adopt the going concern basis of accounting in preparing these
financial statements.
3. Segmental reporting
Management has determined the operating segments based on the
operating reports reviewed by the Executive Directors that are used
to assess both performance and strategic decisions. Management has
identified that the Executive Directors are the Chief Operating
Decision-Maker in accordance with the requirements of IFRS 8
Operating segments.
The determination is that the Group operates as a single
segment, as no internal reporting is produced either by geography
or division. The Group does view performance on the basis of the
type of revenue, and the end destination of the client as shown
below.
Year ended Year ended
30 April 30 April
2019 2018
GBP'000 GBP'000
---------------------------- ---------- ----------
Annual licence fees 5,437 4,979
Professional services 1,528 1,454
---------------------------- ---------- ----------
Total revenue from external
customers 6,965 6,433
---------------------------- ---------- ----------
Year ended Year ended
30 April 30 April
2019 2018
GBP'000 GBP'000
-------------------------------------- ---------- ----------
UK and Europe 5,248 4,615
North America and Rest of the World 1,717 1,818
-------------------------------------- ---------- ----------
Total revenue from external customers 6,965 6,433
-------------------------------------- ---------- ----------
4. Operating EBITDA
Operating EBITDA is calculated from Operating loss as shown
below.
Year ended Year ended
30 April 30 April
2019 2018
GBP'000 GBP'000
------------------------------ ---------- ----------
Operating loss (1,610) (3,588)
Depreciation and amortisation 1,041 1,064
Share-based payments 125 194
Impairment of goodwill - 364
Acquisition costs 12 150
------------------------------ ---------- ----------
Operating EBITDA loss (432) (1,816)
------------------------------ ---------- ----------
5. Loss per share
Basic earnings per share is calculated by dividing the net loss
for the year attributable to ordinary shareholders by the weighted
average number of ordinary shares outstanding during the year.
Diluted earnings per share is calculated by dividing the net
loss for the year attributable to ordinary shareholders by the
weighted average number of ordinary shares outstanding during the
year plus the weighted average number of ordinary shares that would
be issued on the conversion of all dilutive potential ordinary
shares into ordinary shares.
Year ended Year ended
30 April 30 April
2019 2018
--------------------------------------------- ------------ ------------
Loss for the year attributable to the owners
of the parent GBP1,128,000 GBP3,234,000
Weighted average number of ordinary shares 192,675,521 183,820,205
--------------------------------------------- ------------ ------------
Pence Pence
--------------------------------------------- ------------ ------------
Basic and diluted loss per share: ordinary
shareholders 0.59 1.76
--------------------------------------------- ------------ ------------
Annual report and accounts
The annual report and accounts will be posted to shareholders
shortly and will be available for members of the public at the
Company's registered office 60 St. Martin's Lane, Covent Garden,
London WC2N 4JS, and on the company's website
www.rosslyndatatech.com.
Annual General Meeting
The Company's Annual General Meeting to be held at 154-160 Fleet
Street, Blackfriars, London EC4A 2DQ on 17 October 2019 at
11.00am.
+44(0)77 7162
3345
Rosslyn Data Technologies Roger Bullen, Chief Executive +44(0)20 7138
plc Officer 3203
+44(0)79 3054
7441
Ash Mehta, Chief Financial +44(0)20 7138
Officer 3203
Cenkos Securities,
Nominated Adviser, +44(0)20 7397
Broker Stephen Keys/Giles Balleny 8924
Notes to Editors
Rosslyn Data Technologies plc, (AIM: RDT) is a leading provider
of a cloud-based big-data analytics platform. The company provides
analytical services by combining four key technologies: bulk data
extraction; cleansing; enrichment; and visualisation, through a
single cloud platform enabling users with detailed data to make
more informed decisions. Rosslyn's RAPid platform is the Group's
primary product available to its multinational customers. Further
information can also be found on the Company's website at:
www.rosslyndatatech.com
This information is provided by RNS, the news service of the
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of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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