TIDMTUNG
RNS Number : 8018A
Tungsten Corporation PLC
04 June 2021
4(th) June 2021
TUNGSTEN CORPORATION PLC
("Tungsten" or the "Company")
TRADING UPDATE FOR FINANCIAL YEAR ENDED 30 APRIL 2021
Tungsten Corporation plc (AIM: TUNG), a leading provider of
digital financial management products and software solutions, today
issues a trading update ahead of the announcement of its full-year
results for the year ended 30 April 2021.
Trading continues to recover following the initial impact of
COVID-19 on transaction volumes. Towards the end of FY21, we have
seen strong momentum in new sales and recovering transaction
volumes.
Operational performance:
-- New customer wins increased in FY21 to 8 (FY20: 6 wins) from
large international corporations delivering total contract
value (TCV) (1) of GBP2 million with GBP0.7 million expected
to be recognised in FY21. This represents TCV growth of 137%
versus FY20.
-- Largest ever customer win with Nippon Telegraph and Telephone
(NTT Europe) taking the combined offering of Total AP, Total
AR and Workflow, with the potential to become a global deal
for all of NTT.
-- Signed a significant new partnership with FIS Worldpay which
will deliver integrated payment offerings to our customers
as part of our expansion into the invoice-to-pay space.
-- Orbian Tungsten Network (OTN) supply chain financing partnership
financed flows of over GBP500m in the last 11 months.
-- Executive team further strengthened with the additions of a
new Chief Technology Officer; Chief Product & Business Development
Officer and Chief Marketing Officer.
Financial performance:
-- On a constant currency basis revenue (excluding revenue from
our wound down Tungsten Network Finance ("TNF")(2) segment)
grew 1.4% year on year - on a reported basis (excluding TNF)
it reduced from GBP36.3 million to GBP36.0 million, in part
reflecting the strengthening of the pound against the dollar.
-- FY21 total group revenue (including TNF) decreased from GBP36.8
million to GBP36.0 million.
-- 93% of revenue was repeatable and recurring. This provides
us with continued visibility of future revenues. New sales
billings (NSB) (3) grew by 7% from GBP3.3 million to GBP3.6
million.
-- FY21 Adjusted EBITDA(4) is expected to be in line with guidance,
this was achieved via our restructuring activities from H1.
-- Net cash(5) of GBP2.1 million compared to GBP3.2 million at
30 April 2020; cash generation for the full year was GBP(1.1)
million primarily impacted by the cost of restructuring activities
from FY20 and FY21. However in H2 net cash has increased by
GBP1.1 million due to higher billings and strong working capital
management.
Update on COVID-19 and current trading
In FY21, due to the impact of the COVID-19 pandemic, transaction
volumes decreased by 4% to 18.3 million from 19.0 million in FY20
and we maintained our RFC drawdown at GBP2 million, in line with
the prior year. For March and April FY21 the combined transaction
volumes increased by 9% versus the same period in FY20. This
trajectory has continued into FY22.
Andrew Lemonofides, Chief Executive Officer of Tungsten
Corporation plc, said:
"We have delivered a robust performance in response to a
challenging business environment, centred on our strategic
investment in our sales team and the building out of our
partnership network. I remain immensely grateful to and proud of
our colleagues for their continued commitment to supporting our
customers through this difficult time.
"Our current sales conversion rate and increasing year-on-year
transaction volumes across the business, particularly in Europe and
North America, gives us cautious optimism for FY22 delivery. T he
solid sales pipeline and an additional GBP1.0 million of investment
in tech development and compliance functions in FY22 will provide
us with a strong platform for future growth."
Notes
1 Total contract value is defined as annual recurring revenue
and one off implementation revenue contracted with a customer
2 The TNF segment was fully wound down in Q1 FY21
3 New sales billings represents implementation, subscription,
license , and professional services fees to be billed in the period
from new sales made in that period. Implementation and subscription
fees are recognised to revenue over the 6 months and 12 months
respectively from billing month. Subscription and licence fees are
recognised in the month sold. Professional services fees are
recognised on work completion milestone. H1 NSB grew by 38% from
GBP1.5 million to GBP2.1 million; on the new basis of NSB
calculation which excludes transaction revenues.
4 Adjusted EBITDA is defined as operating profit before other
income, depreciation, amortisation, gain or loss on sale, foreign
exchange gain or loss, share-based payments charge and exceptional
items
5 Net cash is calculated as cash and cash equivalents on the
balance sheet less drawings under the HSBC Revolving Credit
Facility
Enquiries
Tungsten Corporation plc
Andrew Lemonofides, Chief Executive Officer
Ian Kelly, Chief Financial Officer +44 20 7280 6980
Canaccord Genuity Ltd (Nominated Advisor
& Broker)
Simon Bridges
Andrew Potts +44 20 7523 8000
Tavistock Communications Financial PR
& IR
Heather Armstrong
Jos Simson
Katie Hopkins +44 20 7920 3150
About Tungsten Corporation plc
Tungsten Corporation (LSE: TUNG) is the world's largest,
compliant business transaction network. A leading global electronic
invoicing and purchase order transactions network, Tungsten's
mission is centred on enabling a touchless invoice process allowing
businesses around the globe to gain maximum value from their
invoice process.
Tungsten processes invoices for 74% of the FTSE 100 and 71% of
the Fortune 500. It enables suppliers to submit tax compliant
e-invoices in 50 countries, and last year processed transactions
worth GBP195bn for organisations such as Caesars Entertainment,
Computacenter, GlaxoSmithKline, Kraft Foods, Mohawk Industries,
Mondelēz International, Procter & Gamble, Shaw Industries,
Unilever and the US Federal Government.
Founded in 2000 and headquartered in London, Tungsten has
offices in the US, Bulgaria and Malaysia, employing over 300
people.
Forward looking statements
This document contains forward-looking statements that may or
may not prove accurate. For example, statements regarding expected
revenue growth and trading margins, market trends and our product
pipeline are forward-looking statements. Phrases such as "aim",
"plan", "intend", "anticipate", "well-placed", "believe",
"estimate", "expect", "target", "consider" and similar expressions
are generally intended to identify forward-looking statements.
Forward-looking statements involve known and unknown risks,
uncertainties and other important factors that could cause actual
results to differ materially from what is expressed or implied by
the statements. Any forward-looking statement is based on
information available to Tungsten as of the date of this statement.
All written or oral forward-looking statements attributable to
Tungsten are qualified by this caution. Tungsten does not undertake
any obligation to update or revise any forward-looking statement to
reflect any change in circumstances or in Tungsten's
expectations.
This announcement contains inside information for the purposes
of article 7 of the Market Abuse Regulation (EU) 596/2014 as
amended by regulation 11 of the Market Abuse (Amendment) (EU Exit)
Regulations 2019/310. With the publication of this announcement,
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