Unaudited interim results for the six months ended 30 September 2018
20 Nov 2018
In line results; strong growth in UK and US new business Eckoh plc (AIM: ECK), the global provider of secure payment products and customer contact solutions, is pleased to announce its unaudited results for the six months to 30 September 2018.
| £m unless otherwise stated | H1 FY19 | H1 FY18 Restated1 |
Change |
| New business contracted 5 | 14.2 | 8.7 | 63% |
| Total business contracted | 16.8 | 12.2 | 38% |
| Revenue | 13.1 | 13.4 | (2%) |
| Recurring Revenue % 2 | 87% | 86% | +100 bps |
| Gross profit | 11.0 | 11.4 | (4%) |
| Adjusted EBITDA 3 | 1.6 | 1.9 | (15%) |
| (Loss)/ profit before taxation | (0.2) | 0.8 | |
| Diluted Earnings per share | (0.07p) | 0.31p | |
| Net Cash | 3.4 | 1.7 |
Strategic highlights:
• Results in line with Board expectations
• Strong momentum in the UK and US underpinned by record new business contracted and order book
• New business contracted in half year exceeds entire prior year in the UK and US Secure Payments
• Significant progress in US Secure Payments: revenues up 67%, record new business contracted in the half year, including our largest ever contract valued at $7.4m
• Return to growth in UK: improved sales channel, delivered new contracts through BT and Capita
Financial Highlights:
• Recurring revenue up to 87% (H1 FY 181: 86%)
• Significant increase in deferred revenue to £12.7m (H1 FY181: £8.6m), reflecting business wins and impact of IFRS 15
• US Secure Payments order book grew 78% to $21.7m (H1 FY181: $12.2m)
• Revenues down 2%, or 1.4% at constant currency 4
o UK up 5% driven by successful restructuring of sales function
o US down 14%: growth in Secure Payments offset by short-term decline in Support and Coral
• Balance sheet strengthened with net cash of £3.4m (H1 FY18: £1.7m)
Current Trading:
• Year to date new contracted business now exceeds FY18 total of £15.3m
• Strong and growing pipeline in US Secure Payments, further contracts won since period end
• Largest contract renewal secured with Vue Cinemas worth £2m over 3 years
• Record visibility for second half
Nik Philpot, Chief Executive Officer, said:
"Eckoh has had an extremely strong first half with significant increases in new business contracted in both the UK and US. Following the steps taken last year it is pleasing to see the UK return to growth in such a convincing manner and the US Secure Payments business performed particularly strongly with record levels of new business contracted and a total order book that now well exceeds $20m.
Whilst the IFRS 15 accounting rule changes have reduced reported revenue and profit, we have excellent revenue visibility from the increasing levels of deferred revenue and a fast growing order book, which provides a solid platform for predictable significant growth and further confidence in the outlook for future periods. We remain excited by the prospects for the Group."
NOTES
1. See note 6 for details regarding the restatement as a result of adoption of IFRS15 – Revenue from Contracts and Customers
2. Recurring revenue is defined as on-going revenue on a transactional basis, rather than revenue derived from the set-up and delivery of a new service or hardware.
3. Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) is the profit before tax adjusted for depreciation, amortisation, finance income, finance
expense, legal fees and settlement costs and expenses relating to share option schemes.
4. Constant currency (using last year exchange rates)
5. New business contracted excluding renewals with existing customers.