TIDMRDT
RNS Number : 3149L
Rosslyn Data Technologies PLC
12 January 2021
Rosslyn Data Technologies plc
("Rosslyn", the "Group" or the "Company")
Interim Results for the year ended 31 October 2020
Rosslyn Data Technologies (AIM:RDT), the provider of a leading
cloud based enterprise data analytics platform, is pleased to
announce its interim results for the six months ended 31 October
2020.
Highlights
-- Significant investment into growing our sales and marketing
teams, including the appointment of a Chief Customer Officer and a
doubling of headcount.
-- This investment is already delivering returns and our
pipeline has grown to its largest ever size.
-- Investment into product development, including User Interface
and User Experience (UI/UX) improvements to the Rosslyn platform,
such as self-service tools and smart dashboard creation and further
developments in progress covering Artificial Intelligence and
Robotic Process Automation
-- Group revenues of GBP3.6 million (H1 2020: GBP3.1 million)
and gross profit margin of 82.2% (H1 2020 81.2%)
-- Administrative expenses increased to GBP3.14 million (H1
2020: GBP2.69 million) as a result of investment into sales and
marketing
-- Operating EBITDA loss was GBP144,000 (H1 2020: GBP155,000 loss)
-- Annual Recurring Revenue ("ARR") of GBP6.2 million (H1 FY2020: GBP6.0 million)
-- Successfully raised GBP 6.8 million net of expenses in May;
cash balance of GBP7.23 million as at 31 October 2020.
-- Post period end launch of CustomsCloud(TM) , a cloud-based
self-service solution designed to enable importers to manage the
additional customs procedures resulting from the UK's departure
from the European Union .
Roger Bullen, CEO, commented: "I am delighted with how the
business has performed during these challenging times and we remain
confident in the performance of the business for the full year.
Additionally, having been able to accelerate our investments into
Sales and Marketing gives us a significant opportunity to achieve
higher growth rates next year and beyond."
+44(0)77 7162
3345
Rosslyn Data Technologies Roger Bullen, Chief Executive +44(0)20 3285
plc Officer 8008
Ash Mehta, Chief Financial +44(0) 20 3051
Officer 7798
Cenkos Securities,
Nominated Adviser, Stephen Keys/Giles Balleny/Camilla +44(0)20 7397
Broker Hume 8924
Chief Executive's Review
As in most organisations during the first half of this financial
year, coronavirus has brought about new challenges that we have
needed to face head on. I am delighted to say that our ability to
embrace a full digital environment has enabled us to support our
clients effectively over this difficult time, especially those
clients operating in the retail, travel and entertainment sectors
who we have assisted, not only with our COVID dashboard, but also
with specific analysis, whilst always maintaining client service
levels. In addition, we have implemented projects for our clients
in the airline and rail sectors to identify savings in particular
product categories, as well as by reducing "tail spend" ie reducing
the number of small value suppliers. We have also made good
progress on the initiatives we outlined at the time of our
fundraising in May.
Business Review
Investment into Sales and Marketing
Following the fundraising, we started to invest significantly in
our sales and marketing teams. Due to increases in RFP and RFI
activity in August and September and following the appointment of
Paul Watts as Chief Customer Officer in August, we decided to
accelerate our investment program to be able to maximise the
potential of an increasing number of opportunities, thereby
doubling the Sales and Marketing headcount over the last six
months, ahead of schedule.
This investment will result in higher operating costs for the
full year than initially anticipated but it has allowed us to
gather momentum and we have already seen a significant uplift in
both sales leads and marketing opportunities over the last few
months. This investment is paying off in the growth of our customer
opportunity pipeline as described below.
We are focussing our sales and marketing effort on large
enterprises in key industry segments which we sell predominantly
through our direct channel. Supporting each of these segments is a
customer success team, which supports not just the implementation
but also the expansion of the footprint of the platform in each
account, as well as ensuring client utilisation to extract benefits
from the product, thereby assisting customer satisfaction and
future renewal.
Pipeline
Although the impact of the pandemic has resulted in a slowdown
of the roll-out of digital transformation platforms by procurement
departments, these programs have not been cancelled. The benefits
and the need to implement such platforms has been made very clear
by recent circumstances, which have highlighted supply chain risk
and resilience in large companies.
The investment into Sales and Marketing means that our pipeline
is stronger than ever before, having grown by 18% during the
period, and I am pleased to report that we are in advanced
negotiations with a number of large enterprises and look forward to
updating shareholders in due course. However, the uncertainty of
coronavirus hangs over all decisions to be made by potential
clients.
On the partner front, our focus is on making our existing
partners more effective in selling the benefits of the platform.
Our partners extend and scale our sales capability and we are in
the process of expanding our partner base geographically,
predominantly through mainland Europe.
Customer acquisition and existing clients
During the period, we managed to continue to acquire new
customers, and expand relationships with existing customers.
Furthermore, despite the slowdown due to the impact of the pandemic
our revenues from our installed customer base have held up well and
customer churn remained low, at 4.5% for the period.
We believe that our appeal to customers is due to our ability
to;
-- significantly reduce the complexities associated with capturing and managing their data;
-- improve their analytical capabilities, and reduce the costs of deploying analytics;
-- increase the speed of deployment;
-- demonstrate a positive return on our clients' investments; and
-- offer the clients a broad menu of products that allows them
to choose to take more modules over time as they see the benefits
of the full suite.
These features clearly illustrate the emerging value of the
Rosslyn business model which is now central to our strategy of
implementing digital transformation across the procurement
functions of large companies.
Launch of CustomsCloud(TM)
We released our Langdon CustomsCloud(TM) software in December
2020. The cloud-based self-service solution is designed to enable
importers to manage the additional customs procedures resulting
from the UK's departure from the European Union, allowing Langdon
clients to register with HMRC and to file all import declarations,
either individually or in bulk, calculate the VAT and duty owed on
any imports and to report this information direct to HMRC for
future payments. CustomsCloud(TM) automates the process, saving
time for clients and also provides certainty by reducing the risk
of unknown future charges being payable on the client's
imports.
Even with a trade agreement having been signed between the UK
and the EU, it is expected that over 200,000 UK businesses that
import from the EU will need to start completing customs
declarations for the first time. Many businesses are applying for
government grants, which provide funding for investment into IT
projects for customs declarations, such as CustomsCloud(TM) . We
believe that the advantages of our product mean that we are well
placed to benefit from increased IT spend in this area. Sales of
CustomsCloud(TM) have started well in 2021, with many new client
signings and a healthy pipeline of client prospects for the coming
months.
Product evolution
We are benefiting from the fact that large companies are
increasingly choosing to move from traditional on-premise
applications to cloud based services. This is because the
technology value gap between a traditional on-premise solution and
a cloud-based approach is growing as companies develop faster,
better and more intuitive solutions.
Our integrated cloud platform taps into this trend allowing a
single sign-on and easy navigation to the whole functionality
across the various modules. We believe this will assist us in
improving our sales cycle metrics, accelerate our expansion plans
and maintain a low customer churn rate.
Product Development
The research and development team are executing on an exciting
schedule of improvements to our User Interfaces and User Experience
(UI/UX) and introducing new technologies, which we expect to be
released into full production later this year. These include simple
self-service tools that will enable clients to improve data
management capabilities such as creating their own bespoke
dashboards. An early example of this was the data entry tool for
customs data incorporated into CustomsCloud(TM) , allowing users to
enter data manually and for that data to be submitted to HMRC
through our product.
Future product development will include enhancements of extra
functionality, such as predictive analytical capabilities within
the full Rosslyn supplier management platform. We expect these
tools to improve our customers' risk and resilience analytics and
compliance reporting capabilities as well as information and
insights to support their strategic decision making.
We have also been able to develop and integrate further AI
technologies and robotic process automation, to enhance the UI/UX
described earlier. This work that will continue beyond this current
year but has already been deployed into our recent software
releases.
These investments have a short-term impact on our cost base, but
we expect that they will start to show material benefits to the
Company within the next twelve months.
We believe that the strength of the Rosslyn platform and the new
functionality we have introduced continues to be highly recognised
in the industry, which is giving us the opportunity to take major
steps forward on a number of important fronts, including moving out
of traditional Spend Analytics to be more focussed on procurement
challenges such as supply chain resilience, supply chain risk, and
data management. This broadens out our offering, making us more
relevant to organisations, increases contract values and makes us
more embedded into a client's supply chain infrastructure.
Underpinning this progress is our talented and skilled
development team who are fuelling the innovative solutions and
widening the sphere of sales opportunities. Their depth of
expertise and agile approach enables us to respond quickly to
customer needs and market opportunities and give us an advantage
over the traditional on-premise approach.
Financial performance
The Group is reporting revenues of GBP3.57 million which are
14.6% up on this time last year and a small EBITDA loss of
GBP144,000 due to the investment into Sales and Marketing and
Product Development in the period. Our churn is low and has largely
been mitigated by contract wins resulting in an ARR that is down
slightly from the start of the year to GBP6.2m, but still higher
than this time last year (GBP6.0m). Further details are given in
the CFO Report below.
Prospects
The second half of our financial year has begun well. There have
been a number of new customer wins as well as good levels of upsell
of additional functionality into our current customer portfolio. We
have been short listed as the preferred vendor in the US and Europe
for potential new contracts which cover new exciting industry
sectors and applications for Rosslyn and we look forward to
updating shareholders in due course. These contracts typically
incorporate the full, combined Rosslyn product suite.
Our pipeline is healthy and, thanks to the impact of our new
solutions and services, we are negotiating contracts with
significantly larger values than we have done in the past. Given
their size, and the ongoing coronavirus situation, these contracts
are taking longer to negotiate and obtain approval within clients.
We remain confident of a successful outcome for the year although,
like many companies in the current environment, the ongoing
presence of coronavirus means that the timing of the conclusion of
contract negotiations and the virus' impact on the year cannot be
certain at this time.
The directors are pleased with the progress made to date in
these extremely testing times and believe that the Rosslyn platform
is emerging as a recognised and well-regarded technology in this
large and growing market place, and through our continued and
disciplined execution, we expect progress to continue. The Company
is increasingly well positioned to take advantage of opportunities,
and we continue to seek acquisitions which would accelerate growth
and help provide a broader offering and client base.
The Group's strategy remains to build a strong and dynamic
company focused on growth and building shareholder value. We remain
confident that, supported by strong contracted revenue visibility
and renewed business momentum, we will continue to build on the
solid progress and foundations laid during the first half of the
year.
Roger Bullen
Chief Executive
12 January 2021
Finance Director's report
Despite the difficult circumstances of coronavirus during the
period, Group revenues increased by 14.6% to GBP3.57 million (H1
2020: GBP3.12million). This was driven partly by the acquisition of
Langdon which was acquired in September 2019 and therefore only
contributed one month of revenues in last year's interim results.
Underlying revenues held up well with little churn during the
period. However, as described in the CEO Report the slowness of
clients to commit to new investments meant that opportunities to
grow revenues more rapidly were limited.
Gross profit margin improved to 82.2% (H1 2020: 81.2%) as we
continued to make more efficient use of third-party cloud
resources.
Administrative expenses increased to GBP3.14 million (H1 2020:
GBP2.69 million) as we accelerated investment into sales and
marketing. As a result, the Operating EBITDA loss was GBP144,000
(H1 2020: GBP155,000 loss). The average headcount in the period
increased to 64 (H1 2020: 62), but the headcount as 31 October 2020
was 67 with most additions in sales and marketing and with the full
benefit of these new hires still to be received.
The basic and diluted loss per share for the period was 0.21p
(H1 2020: 0.43p).
The cash balance at the period end was GBP7.23 million following
May's fundraising of GBP6.8 million net of expenses. Net cash used
in operating activities during the period was GBP272,000 (H1 FY20:
GBP1,191,000). The bank debt continues to be paid down and the
balance stood at GBP1.05 million at 31 October 2020.
Due to the slowdown in closing of sales opportunities as
described in the CEO Report, and a small degree of churn (4.5%) the
annual recurring revenue at the period end was down slightly to
GBP6.2 million since the year end (30 April 2020: GBP6.3 million),
but nevertheless up from this time last year (H1 FY2020: GBP6.0
million). The contract revenue backlog reduced from GBP6.3 million
at the start of the period to GBP5.9m at 31 October 2020 but
remains well above the level this time last year (30 October 2019:
GBP5.1 million).
Ash Mehta
Finance Director
12 January 2021
Consolidated statement of comprehensive income
For the six months ended 31 October 2020
Six months Six months Year
ended ended ended
31 October 31 October 30 April
2020 2019 2020
Unaudited Unaudited Audited
Notes GBP'000 GBP'000 GBP'000
------------------------------------------- ----- ----------- ----------- ---------
Revenue 3 3,573 3,117 7,109
Cost of sales (636) (586) (1,086)
------------------------------------------- ----- ----------- ----------- ---------
Gross profit 2,937 2,531 6,023
Other operating income 4 54 - -
Administrative expenses (3,137) (2,686) (5,987)
Depreciation and amortisation (567) (606) (1,703)
Share based payment (120) (59) (69)
Operating loss (833) (932) (1,736)
Finance income 17 - -
Finance costs (67) (80) (69)
Loss before income tax (883) (1,012) (1,896)
Income tax credit 171 186 316
------------------------------------------- ----- ----------- ----------- ---------
Loss for the period (712) (826) (1,580)
------------------------------------------- ----- ----------- ----------- ---------
Other comprehensive loss - (4) (4)
Total comprehensive income (712) (830) (1,584)
------------------------------------------- ----- ----------- ----------- ---------
Loss per share
Basic and diluted loss per share: ordinary
shareholders (pence) 5 (0.21) (0.43) (0.82)
------------------------------------------- ----- ----------- ----------- ---------
Consolidated balance sheet
As at 31 October 2020
31 October 31 October 30 April
2020 2019 2020
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
----------------------------------- ---------- ---------- --------
ASSETS
Non-current assets
Intangible assets 1,491 2,822 2,029
Property, plant and equipment 17 10 13
Right-of-use assets 99 209 52
----------------------------------- ---------- ---------- --------
1,607 3,041 2,094
----------------------------------- ---------- ---------- --------
Current assets
Trade and other receivables 2,548 1,917 2,039
Corporation tax receivable 332 521 196
Cash and cash equivalents 7,227 499 794
----------------------------------- ---------- ---------- --------
10,107 2,937 3,029
----------------------------------- ---------- ---------- --------
Total assets 11,714 5,978 5,123
----------------------------------- ---------- ---------- --------
LIABILITIES
Current liabilities
Trade and other payables (4,331) (4,052) (4,109)
Financial liabilities - borrowings (388) (587) (388)
----------------------------------- ---------- ---------- --------
(4,719) (4,639) (4,497)
----------------------------------- ---------- ---------- --------
Non-current liabilities
Trade and other payables (414) - (135)
Deferred tax (109) (182) (145)
Financial liabilities - borrowings (666) (887) (828)
----------------------------------- ---------- ---------- --------
(1,189) (1,069) (1,108)
----------------------------------- ---------- ---------- --------
Total liabilities (5,908) (5,708) (5,605)
----------------------------------- ---------- ---------- --------
Net assets 5,806 270 (482)
----------------------------------- ---------- ---------- --------
Equity
Called up share capital 1,699 965 965
Share premium 18,923 12,777 12,777
Share-based payment reserve 590 470 470
Accumulated loss (20,419) (19,071) (19,707)
Translation reserve (120) (108) (120)
Merger reserve 5,133 5,133 5,133
----------------------------------- ---------- ---------- --------
Total equity 5,806 270 (482)
----------------------------------- ---------- ---------- --------
Consolidated cash flow statement
For the six months ended 31 October 2020
Six months Six months Year
ended ended ended
31 October 31 October 30 April
2020 2019 2020
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
----------------------------------------------------- ----------- ----------- ---------
Cash flows from operating activities
Loss before income tax (883) (1,012) (1,896)
Adjustments for:
- depreciation, amortisation 569 718 1,703
- share-based payments 120 59 69
- finance income (17) - -
- finance costs 67 80 160
(144) (155) 36
Increase in receivables (509) (201) (342)
Increase/(decrease) in payables 431 (755) (550)
----------------------------------------------------- ----------- ----------- ---------
Cash used from operations (222) (1,111) (856)
Finance income 17 - -
Finance costs (67) (80) (160)
Corporation tax received - - 310
Net cash used in operating activities (272) (1,191) (706)
----------------------------------------------------- ----------- ----------- ---------
Cash flows from investing activities
Purchase of property, plant and equipment (13) (1) (8)
Acquisition of business - (49) (49)
Net cash used in investing activities (13) (50) (57)
----------------------------------------------------- ----------- ----------- ---------
Cash flows from financing activities
Proceeds from share capital issued (net) 7,352 2 2
Costs of share issue (472) - -
Proceeds from bank and other borrowings - 500 500
Repayment of bank and other borrowings (162) (722) (905)
Net cash from/(used in) financing activities 6,718 (220) (403)
----------------------------------------------------- ----------- ----------- ---------
Net increase/(decrease) in cash and cash equivalents 6,433 (1,461) (1,166)
Cash and cash equivalents at beginning of period 794 1,960 1,960
Cash and cash equivalents at end of period 7,227 499 794
----------------------------------------------------- ----------- ----------- ---------
Notes to the unaudited interim statements
For the six months ended 31 October 2020
1. Basis of preparation
This interim report has been prepared in accordance with the
accounting policies disclosed in the full statutory accounts for
the year ended 30 April 2020.
These policies are in accordance with International Financial
Reporting Standards and International Accounting Standards and
Interpretations (collectively "IFRS") issued by the International
Accounting Standards Board, as endorsed for use in the European
Union, that are expected to be applicable for the year ending 30
April 2021.
The Group has chosen not to adopt IAS 34 "Interim Financial
Statements" in preparing the interim consolidated financial
information.
The financial information in this statement relating to the six
months ended 31 October 2020 and the six months ended 31 October
2019 has not been audited.
The financial information for the year ended 30 April 2020 does
not constitute the full statutory accounts for that period. The
annual report and financial statements for the year ended 30 April
2020 has been filed with the Registrar of Companies.
The Independent Auditor's Report on the annual report and
financial statement for the year ended 30 April 2020 was
unqualified, did not draw attention to any matters by way of
emphasis and did not contain a statement under Section 498(2) or
498(3) of the Companies Act 2006.
The interim report for the period ended 31 October 2020 was
approved by the Board of Directors on 11 January 2020.
2. 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.
Six months Six months Year
ended ended ended
31 October 31 October 30 April
2020 2019 2020
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
---------------------- ----------- ----------- ---------
Annual licence fees 2,947 2,628 5,625
Professional services 626 489 1,484
---------------------- ----------- ----------- ---------
Total revenue 3,573 3,117 7,109
---------------------- ----------- ----------- ---------
Six months Six months Year
ended ended ended
31 October 31 October 30 April
2020 2019 2020
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
------------------------------------ ----------- ----------- ---------
UK and Europe 2,897 2,421 5,638
North America and Rest of the World 676 696 1,471
------------------------------------ ----------- ----------- ---------
Total revenue 3,573 3,117 7,109
------------------------------------ ----------- ----------- ---------
3. Operating EBITDA
Operating EBITDA is calculated from Operating loss as shown
below.
Six months Six months Year
ended ended ended
31 October 31 October 30 April
2020 2019 2020
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
------------------------------ ----------- ----------- ---------
Operating loss (833) (932) (1,736)
Depreciation and amortisation 569 718 1,703
Share-based payments 120 59 69
Operating EBITDA (144) (155) 36
------------------------------ ----------- ----------- ---------
4. Other operating income
Other operating income is amounts received in the form of
furlough payments and similar non-repayable grants from government
bodies as a result of the coronavirus pandemic.
5. Earnings per share
Basic earnings per share is calculated by dividing the net loss
for the period attributable to ordinary shareholders by the
weighted average number of ordinary shares outstanding during the
period. Diluted earnings per share is calculated by dividing net
loss for the period attributable to ordinary shareholders by the
weighted average number of ordinary shares outstanding during the
period plus the weighted average number of ordinary shares that
would be issued on the conversion into ordinary shares of all
potentially dilutive instruments. In the periods ended 31 October
2020, 31 October 2019 and 30 April 2020 there were share options in
issue which could potentially have a dilutive impact, but as the
Group was loss making they were anti-dilutive for each period and
therefore the weighted average number of ordinary shares for the
purpose of the basic and dilutive loss per share were the same.
Six months Six months Year
ended ended ended
31 October 31 October 30 April
2020 2019 2020
Unaudited Unaudited Audited
------------------------------------------- ----------- ----------- ------------
Loss for the period attributable to the GBP712,000 GBP830,000 GBP1,580,000
owners of the parent
Weighted average number of ordinary shares 339,066,662 192,847,695 192,884,046
Pence Pence Pence
Basic and diluted loss per share: ordinary
shareholders (0.21) (0.43) (0.82)
------------------------------------------- ----------- ----------- ------------
6. Dividends
No interim dividend (2019: nil) will be paid to
shareholders.
7. Principal risks and uncertainties
The principal risks and uncertainties for this six-month period
remain broadly consistent with those set out in the Financial
Review section of the financial statements of the Group for the
year ended 30 April 2020.
8. Interim report
Copies of the interim report are available to the public on the
Group's website at www.rosslyndatatech.com , and from the
registered offices of Rosslyn Data Technologies plc at 1000
Lakeside North Harbour, Western Road, Portsmouth, Hampshire,
England, PO6 3EN or by email to investors@rosslyndatatech.com .
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
IR FLFIALIILLIL
(END) Dow Jones Newswires
January 12, 2021 02:00 ET (07:00 GMT)
Rosslyn Data Technologies (LSE:RDT)
Historical Stock Chart
From Apr 2024 to May 2024
Rosslyn Data Technologies (LSE:RDT)
Historical Stock Chart
From May 2023 to May 2024