08:00 Wed 06 Sep 2017
LoopUp Group PLC - Interim Results
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Interim results for the six months ended
Financial Highlights
£ million |
Six months to (unaudited) |
Six months to 30 June 2016 (unaudited) |
Year-on-year growth |
LoopUp Revenue(1) |
8.65 |
6.00 |
44.2% |
Total revenue |
8.65 |
6.38 |
35.6% |
LoopUp Gross Profit(1) |
6.65 |
4.42 |
50.3% |
LoopUp Gross Profit margin(1) |
76.8% |
73.7% |
+310 BPS |
LoopUp EBITDA(1),(2) |
1.61 |
0.89 |
81.4% |
LoopUp Operating Profit(1) |
0.51 |
0.14 |
264.3% |
Diluted earnings per share (pence) |
1.9 |
0.2 |
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1. LoopUp Revenue, LoopUp Gross Profit, LoopUp EBITDA and LoopUp Operating Profit are revenue, gross profit, EBITDA and operating profit respectively from the
2. Earnings before interest, taxation, depreciation, amortisation and share based payments charges.
Operational Highlights
· 44% growth in LoopUp Revenue, an increase in growth rate from 39% in FY2016 and 36% in FY2015. Growth at constant currency in H1 2017 was 37.2% year-on-year compared to 31% in each of FY2016 and FY2015
· 310 basis point improvement in like-for-like gross profit margin compared to H1 2016, leading to a 50.3% growth in LoopUp Gross Profit
· The Group maintained its track record of 'negative net churn' - i.e. net growth - in its established base of customers that are at least one year old. Net growth in H1 2017 was 9.1% (FY2016: 8.3%)
· Continued investment in the Group's team-based 'Pods' for new business acquisition led to an average of 7.7 Pods during the period (FY2016: 6.2 Pods), each costing
· Particularly strong US growth with the Group generating 36% of LoopUp Revenue from the
· Introduced support for enterprise Single Sign-On (SSO) into the
· Introduced inter-connected multi-site bridging into
· The Group paid down a final debt installment of
"We are very pleased to report continued strong performance in our 2017 interim results.
The second half of 2017 has started encouragingly with some major new customer wins set to roll out, and we remain confident for the full financial year as well as in our ability to deliver growth beyond that. We attribute our continued positive performance and outlook to our highly differentiated product strategy in the large
For further information, please contact:
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via FTI |
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+44 (0) 207 886 2500 |
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+44 (0) 203 727 1000 |
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About
The Group is headquartered in
Notes:
This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014.
Chief Executive Officers' Business Review
We're pleased to report on another period of robust performance in the first half of 2017. The period has seen us deliver strong revenue growth, gross margin improvements and increased profitability at both EBITDA and operating profit levels. Helping to drive this progress, we have maintained efficient new business acquisition and customer retention metrics and made progress against our strategic objectives.
Continued strong growth
We have maintained our track record of consistently strong revenue growth. On a sterling-reported basis, LoopUp Revenue grew by 44% year-on-year compared to H1 2016, up from 39% growth in FY2016 and 36% growth in FY2015.
On a constant currency basis, 37 percentage points were due to business growth and 7 percentage points were due to dollar currency changes against the pound year-on-year compared to H1 2016. This constant currency growth of 37% exceeds previous periods, namely 31% in each of FY2016 and FY2015.
Key driver of consistent growth: differentiated product strategy
The consistency of our strong growth in this
More than twenty years into this technology space, most business users are still dialling into conference calls with numbers and codes. It is
There are plenty of highly-functional software products in the market, vying for the attention of tech-savvy early adopters and specialist departmental users such as training and IT staff.
1Survey commissioned by
Continued efficiency of growth
Our team-based 'Pods' organisational structure for new business acquisition has continued to operate to efficient underlying unit economics. During H1 2017, each of the 7.7 Pods delivered an average of
Furthermore, in our established customer base, we have again demonstrated 'negative net churn'. Taking into account all losses, shrinkages and growths, LoopUp Revenue in the period from all customers of at least one year old actually net grew year-on-year by 9.1% (FY 2016: 8.3%).
Our customer base remains well diversified, with the largest single customer (which the Group won in 2016) representing just 3.8% of total LoopUp Revenue. Our top 100 customers accounted for 63% of LoopUp Revenue, and the top 500 accounted for 91%. The Group generated 36% of LoopUp Revenue from the
Progress against our strategic priorities
We have made strong progress against each of our three strategic priorities:
· As indicated at IPO, we plan to increase the number of Pods to an average of at least eight during 2017 and an average of at least 11 during 2018. With an average of 7.7 during H1 2017, we remain well on track to deliver against these targets.
· Our new Marketing team, which was brought on board after the IPO, has made substantial progress on multiple fronts. They have produced a wealth of original thought leadership content now available in a new 'Resources' zone of our corporate website and which will form a cornerstone of various demand generation activities going forward; initiated a business PR program leading to numerous published articles; established relationships with several leading technology space analyst firms that have already led to research coverage and award recognition; and worked closely with the Group's commercial operations team towards delivering end-to-end tracking of our nascent demand generation activities.
· During H1 2017, we have continued to innovate the
Positive Outlook
We continue to see strong demand for our product from our target market of mid-to-large enterprise and professional services firms. Since the end of the reported period, we've had some major new customer wins set to roll out in the second half, including a major multinational consulting organisation, a premier investment banking advisory firm, and a leading
Unaudited consolidated statement of comprehensive income for the six months to
£'000 |
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Six months to |
Six months to 30 June 2016 |
12 months to 31 December 2016 |
LoopUp Revenue (1) |
|
8,651 |
5,998 |
12,823 |
Discontinued licensing revenue |
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- |
384 |
736 |
Total revenue |
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8,651 |
6,382 |
13,559 |
Cost of sales |
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(2,004) |
(1,579) |
(3,265) |
Gross profit |
|
6,647 |
4,803 |
10,294 |
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Administrative expenses |
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(5,038) |
(3,532) |
(8,231) |
EBITDA (2) |
|
1,609 |
1,271 |
2,063 |
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Depreciation |
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(137) |
(107) |
(246) |
Amortisation |
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(962) |
(644) |
(1,419) |
Other operating income |
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- |
- |
- |
Operating profit |
|
510 |
520 |
398 |
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Finance costs |
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(3) |
(448) |
(684) |
Profit / (loss) before tax |
|
507 |
72 |
(286) |
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Income tax |
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356 |
- |
484 |
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Profit for the period |
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863 |
72 |
198 |
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Other comprehensive income and loss |
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Currency translation loss |
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(80) |
(878) |
(1,209) |
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Total comprehensive income / (loss) for the period attributable to the equity holders of the parent |
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783 |
(806) |
(1,011) |
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Earnings per share (pence) - Note 4 |
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Basic |
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2.1 |
0.3 |
0.6 |
Diluted |
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1.9 |
0.2 |
0.5 |
1. LoopUp Revenue is revenue from the
2. EBITDA is operating profit stated before depreciation, amortisation of intangible fixed assets and share-based payments charges.
Unaudited consolidated statement of financial position at
£'000 |
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Assets |
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Non-current assets |
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Property, plant and equipment |
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528 |
428 |
463 |
Intangible assets |
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5,705 |
3,616 |
4,822 |
Total non-current assets |
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6,233 |
4,034 |
5,285 |
Current assets |
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Trade and other receivables |
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3,539 |
2,795 |
2,802 |
Cash and cash equivalents |
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1,612 |
1,086 |
2,547 |
Current tax |
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- |
- |
500 |
Total current assets |
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5,151 |
3,881 |
5,849 |
Total assets |
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11,384 |
7,925 |
11,134 |
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Liabilities |
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Trade and other payables |
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(1,788) |
(1,284) |
(1,744) |
Accruals and deferred income |
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(986) |
(582) |
(1,378) |
Borrowings |
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- |
(5,110) |
(306) |
Total current liabilities |
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(2,774) |
(6,976) |
(3,428) |
Net current assets / (liabilities) |
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2,377 |
(3,095) |
2,421 |
Non-current liabilities |
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Borrowings |
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- |
(4,811) |
- |
Total non-current liabilities |
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- |
(4,811) |
- |
Total liabilities |
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(2,774) |
(11,787) |
(3,428) |
Net assets / (liabilities) |
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8,610 |
(3,862) |
7,706 |
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Equity |
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Share capital |
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205 |
139 |
204 |
Share premium |
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11,828 |
- |
11,708 |
Other reserve |
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12,691 |
12,691 |
12,691 |
Foreign currency translation reserve |
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(1,888) |
(1,477) |
(1,808) |
Retained loss |
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(14,226) |
(15,215) |
(15,089) |
Shareholders' funds / (deficit) attributable to equity owners of parent |
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8,610 |
(3,862) |
7,706 |
Unaudited consolidated statement of changes in equity at
£'000 |
Share capital |
Share premium |
Other reserve |
Foreign currency translation reserve |
Retained loss |
Shareholders' funds / (deficit) attributable to equity owners of parent |
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Balance at |
139 |
- |
12,691 |
(599) |
(15,287) |
(3,056) |
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Profit and total comprehensive income / (loss) |
- |
- |
- |
(878) |
72 |
(806) |
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Balance at |
139 |
- |
12,691 |
(1,477) |
(15,215) |
(3,862) |
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Profit and total comprehensive income |
- |
- |
- |
(331) |
126 |
(205) |
Share issue on AIM listing |
65 |
12,935 |
- |
- |
- |
13,000 |
Cost of issue of equity shares |
- |
(1,227) |
- |
- |
- |
(1,227) |
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Balance at |
204 |
11,708 |
12,691 |
(1,808) |
(15,089) |
7,706 |
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Profit and total comprehensive income |
- |
- |
- |
(80) |
863 |
783 |
Proceeds from share issue |
1 |
120 |
- |
- |
- |
121 |
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Balance at |
205 |
11,828 |
12,691 |
(1,888) |
(14,226) |
8,610 |
Unaudited consolidated statement of cash flows for the six months to
£'000 |
Six months to |
Six months to 30 June 2016 |
12 months to 31 December 2016 |
Net cash flow from operating activities |
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Profit / (loss) before tax |
507 |
72 |
(286) |
Non-cash adjustments |
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Depreciation and amortisation |
1,099 |
751 |
1,655 |
Interest payable |
3 |
448 |
684 |
Working capital adjustments |
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Increase in trade and other receivables |
(737) |
(699) |
(706) |
Increase / (decrease) in trade and other payables |
(348) |
202 |
1,468 |
Tax receivable |
856 |
483 |
468 |
Cash generated from operations |
1,380 |
1,257 |
3,293 |
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Cash flows from investing activities |
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Purchase of property, plant and equipment |
(202) |
(193) |
(304) |
Addition of intangible assets |
(1,845) |
(1,230) |
(3,211) |
Net cash used in investing activities |
(2,047) |
(1,423) |
(3,515) |
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Cash flows from financing activities |
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Proceeds of borrowings |
- |
778 |
819 |
Proceeds from share issues |
121 |
- |
8,500 |
Issue costs in relation to IPO |
- |
- |
(1,227) |
Repayment of loans |
(306) |
- |
(5,404) |
Interest and finance fees paid |
(3) |
(7) |
(21) |
Finance leases paid |
- |
- |
(10) |
Net cash generated by financing activities |
(188) |
771 |
2,657 |
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Net increase / (decrease) in cash and cash equivalents |
(855) |
605 |
2,435 |
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Cash and cash equivalents brought forward |
2,547 |
402 |
402 |
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Effect of foreign exchange rate changes |
(80) |
79 |
(290) |
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Cash and cash equivalents carried forward |
1,612 |
1,086 |
2,547 |
Notes to the financial information for the six months ended
1. General information
2. Basis of preparation and significant accounting policies
These consolidated interim financial statements have been prepared in accordance with those IFRS standards and IFRIC interpretations issued and effective or issued and early adopted as at the time of preparing these statements (
The results have been prepared in accordance with the accounting policies set out in the Group's
These unaudited interim results have been prepared on a going concern basis. At the balance sheet date, the Group had net cash of
The results for the six months ended
The principal risks and uncertainties faced by the Group have not changed from those set out in the Annual Report and Accounts 2016.
3. Revenue and segmental reporting
The Directors have identified segments by reference to the principal groups of services offered and the geographical organisation of the business as reported to the chief operating decision maker.
Segmental revenues are external and there are no material transactions between segments.
The main segment is LoopUp Revenue which consists of ongoing contracts to provide customers with access to the
£'000 |
Six months to |
Six months to 30 June 2016 |
12 months to 31 December 2016 |
Analysis of revenue by segment: |
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LoopUp Revenue |
8,651 |
5,998 |
12,823 |
Discontinued licencing revenue |
- |
384 |
736 |
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8,651 |
6,382 |
13,559 |
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Analysis of gross profit before tax by segment: |
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LoopUp Revenue |
6,647 |
4,419 |
9,558 |
Discontinued licencing revenue |
- |
384 |
736 |
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6,647 |
4,803 |
10,294 |
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Geographical analysis of total revenue: |
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EU (1) |
3,964 |
3,631 |
7,356 |
US |
4,547 |
2,635 |
5,952 |
Rest of World |
140 |
116 |
251 |
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8,651 |
6,382 |
13,559 |
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Geographical analysis of LoopUp Revenue: |
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EU (2) |
3,964 |
3,247 |
6,620 |
US |
4,547 |
2,635 |
5,952 |
Rest of World |
140 |
116 |
251 |
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8,651 |
5,998 |
12,823 |
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Geographical analysis of non-current assets: |
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EU |
5,775 |
2,648 |
4,897 |
US |
419 |
340 |
351 |
Rest of World |
39 |
46 |
37 |
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6,233 |
3,034 |
5,285 |
(1) Includes revenue earned in the
(2) Includes revenue earned in the
All EU non-current assets reside in the
4. Earnings per share
The basic earnings per share is calculated by dividing the net profit attributable to equity holders of the Group by the weighted average number of ordinary shares in issue during the year excluding those held in treasury:
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Six months to |
Six months to 30 June 2016 |
12 months to 31 December 2016 |
Profit attributable to equity holders (£'000) |
863 |
72 |
198 |
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Weighted average number of ordinary shares in issue ('000) |
40,195 |
27,740 |
32,352 |
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Basic earnings per share (pence) |
2.1 |
0.3 |
0.6 |
The diluted earnings per share has been calculated by dividing the net profit attributable to ordinary shareholders by the weighted average number of shares in issue during the year, adjusted for potentially dilutive shares that are not anti-dilutive.
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Six months to |
Six months to 30 June 2016 |
12 months to 31 December 2016 |
Weighted average number of ordinary shares in issue ('000) |
40,915 |
27,740 |
32,352 |
Adjustments for share options ('000) |
4,290 |
4,423 |
4,413 |
Weighted average number of potential ordinary shares in issue ('000) |
45,205 |
32,163 |
36,765 |
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Diluted earnings per share (pence) |
1.9 |
0.2 |
0.5 |
5. Dividends
The directors did not recommend the payment of a dividend for the years ended
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