IQGeo Group PLC (AIM:IQG) grew revenue more than expected last year and said underlying losses should improve significantly.
Helped by a full year of OSPInsight (OSPI), which was acquired in December 2020, the geospatial productivity and collaboration software specialist said revenue is expected to rise around 48% to not less than £13.7mln for the calendar year.
Gross margins continued to improve as the proportion of subscription revenues increases and are now expected to exceed 60%, from 52% last time. As a result, the company expects adjusted EBITDA loss to be no more than £1.0mln compared to £2.5mln a year earlier.
IQGeo said the reduction in losses was achieved without compromising a disciplined approach to investment for the future, while net cash stood at £11.5mln at the year-end.
“The results for the year are very positive indeed and show considerable progress yet again as we continue the journey of building a high recurring revenue software business,” said chief executive Richard Petti.
Roughly 43% of total revenues are now recurring, up from 35% for the previous year, with the rate up to 55% by the end of the year.
“We are excited by the position we hold within a rapidly growing market,” Petti said. “The telecom and utility operators that IQGeo supports are going through a once-in-a-generation digital transformation as they deploy new fibre, 5G, and decarbonised distributed energy networks.
“IQGeo sees high levels of investment for next generation networks; operators are making strategic decisions now that will be deployed for decades to come; and there is a demand for the flexible, scalable geospatial software solution offered by IQGeo.”
Growth during the year was said to have been enjoyed across both the IQGeo core business and OSPI, with the total customer base expanding to 324 from 262 a year earlier.
With order during the year growing over 60% to £19.5mln, the order book closed at a record high of £14.5mln.
Looking forward, Petti said: “Given the progress that we have made this year, our capabilities and resources, and the opportunities that we see ahead of us in this market, we approach 2022 with excitement and great optimism of the group achieving its ambitions."