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dotDigital's US arm now profitable at the divisional level

The core business continues to trade strongly while the international expansion is proceeding apace
Digital woman
The group is adding customers, and existing customers are spending more

Bulk email specialist dotDigital Group PLC (LON:DOTD) said its core business continues to trade strongly, as the group continues its geographic expansion.

Half-year results largely confirmed the details of last month’s trading update, in which the group revealed trading in the six months to the end of December had been slightly ahead of management’s expectations, dotDigital.

Revenue rose to £14.98mln from £12.85mln the year before, while profit before tax climbed to £4.28mln from £3.31mln.

Revenues from the US region have continued to grow and the US arm is now profitable at the divisional level.

In Asia Pacific (APac) the group has created a direct sales and marketing team based in Australia to further enhance growth and take advantage of the opportunities within the Asia Pacific region. Revenue in APac grew 139% from the year before to A$0.5m with a strong pipeline in place.

Revenue from the Europe, Middle East and Africa region grew by 13% from £11.4mln to £12.8mln, as a result of new client wins and existing clients purchasing more product functionality.

Meanwhile, dotDigital has opened a development hub in South Africa to complement its teams in the UK and Belarus.

The group ended the year with cash of £18.9mln.

“Based on dotDigital's strong performance at the half year to 31 December 2016, the continued demand for marketing automation, the newly released product features and connectors and our investment strategy for further expansion into international markets, the board remains confident of continuing to deliver strong growth, underlying profitability and increasing shareholder value for the remainder of this financial year in line with market expectation," revealed Milan Patel, chief executive and chief financial officer of dotDigital.

dotDigital has delivered interims to December in line with unchanged expectations, and no change to forecasts. Prospects remain promising across each growth driving opportunity – enhancing the recurring revenue per customer, from greater customer numbers through both increased numbers of channels and partnerships, and also increasing the number of territories in which dotmailer focuses. The completed reorganisation of the UK sales team, and the pick-up in US activity in response to the release of Magento 2.1, have restored momentum into 2H, demonstrating effective management action where opportunities for improvement are identified,” it added.

Shares in dotDigital were up 0.3% at 59.2p in a falling market.

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