Our stated strategy of moving clients from perpetual licences to SaaS has been more successful than we anticipated and consequently some short-term licence revenue is being replaced
CEO Phil Reason
What the company does
In short, its tech helps its customers to bring their products to market faster.
The AIM firm owns more than a dozen software applications, including its flagship SEND technology. SEND stands for Standard for the Exchange of Nonclinical Data and is a protocol set up by the US Food and Drug Administration. It ensures that companies present data in a consistent format.
Among Instem’s other top products is Samarind – a software-as-a-service (SaaS) platform that enables companies to register and track their regulated products worldwide by maintaining a single integrated database, which is then used to update drugs watchdogs as products change over time.
How is it doing?
The company enjoyed a solid first half as it cited the financial restructuring of recent years and the “increasing efficacy” of the company’s technology and services for its success.
All three parts of the business – data collection, informatics and regulatory solutions – performed well in the six months ended June 30, investors were told.
Total revenues grew by 11% to £11.7mln, while new software as a service income more than doubled to £1.1mln. Recurring sales, meanwhile, were £7mln.
Underlying earnings (EBITDA) advanced £300,000 to £1.7mln, while basic EPS were 2p, up from 0.3p a year earlier.
CEO Phil Reason told the market: “Strong order intake and pipeline growth during the period enabled accelerated investment in personnel to ensure we execute on these opportunities.
“Our stated strategy of moving clients from perpetual licences to SaaS has been more successful than we anticipated and consequently some short-term licence revenue is being replaced.
“Whilst this will have a slight impact on earnings in the current year, it will generate longer-term recurring revenues going forward.”
Share performance in the year to date
The stock has advanced 68% on the back of some rock-solid progress.