REG - ActiveOps PLC - Interim Results
29/11/2022 07:00
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RNS Number : 8496H ActiveOps PLC 29 November 2022
29 November 2022
ActiveOps Plc
("ActiveOps", the "Company, "the Group")
Interim Results for the six months ended 30 September 2022
ActiveOps plc (AIM: AOM), a leading provider of Management Process Automation
(MPA) software for running hybrid and global back-office operations, is
pleased to announce its unaudited results for the six months ended 30
September 2022.
Financial Highlights:
Six months ended 30 September H1 FY23 H1 FY22 Change
Annual recurring revenue "ARR"(1) £22.1 £19.8m +12%
Total Revenue £12.3m £11.5m +7%
Software & Subscription revenue £10.9m £9.6m +14%
Training & Implementation "T&I" revenue 1.4m £1.9m -26%
Gross margin 81% 80% +1pt
Adjusted EBITDA(2) £0.3m (£0.2m) -
Profit/(loss) before tax (£0.5m) (£1.0)m +50%
Earnings per share on continuing operations (0.99)p (1.40)p +29%
Net cash and cash equivalents £11.0m £10.9m +1%
· ARR(1) growth of 12%, or 7% at constant currency
· Net Revenue Retention at 109% on an annualised basis, following multiple
customer expansion deals and improved customer retention rates
· Software & Subscription revenue up 14% year-on-year, T&I revenue down
slightly in absolute terms, reflecting the timing of contracts, with the Board
confident this revenue will be in line with prior periods for the year
· Gross margins remain strong at 81%, supported by the ongoing efficiency of the
remote delivery model
· Adjusted EBITDA positive, reflecting a mix of careful cost control, timing of
investment and favourable currency conditions
· Cash conversion negative in the period due to seasonality of renewals cycle.
Expected to move to a positive position before year end with significant
renewals in H2
· Balance sheet remains debt free with £11.0m cash in the bank (H1 FY22:
£10.9m), increasing to £13.0m at 28 November 2022
Operational Highlights
· Added three new customers and signed twelve significant expansion deals, with
nine out of ten of the Group's top ten accounts expanding usage of ActiveOps
products
· Launch and first contract win for new CaseworkiQ offering, worth £0.6m in
incremental Annual Recurring Revenue. Established a solid pipeline of
CaseworkiQ opportunities within the existing customer base
· Newly established data science function continues to deliver against its
ambitious AI/Machine Learning product roadmap with new product capabilities to
be released by the end of the financial year
Outlook
· Trading in the second half has begun well keeping the Company firmly on target
to be run-rate EBITDA positive at the end of this financial year
· With a number of contract wins and expansion deals on the horizon and an
expanding product offering the Board looks to the future with confidence
Footnote to Financial highlights
The above non-GAAP measures are unaudited
1. Annual Recurring Revenue - unaudited
2. Adjusted EBITDA is used by management to assess the trading
performance of the business. Defined as Operating profit before depreciation,
amortisation, share-based payment charges and exceptional items and includes
FX differences.
Richard Jeffery, Chief Executive Officer of ActiveOps plc, commented:
"The first half of FY23 has seen the Group continue to perform well, securing
new customer wins and substantial expansion deals, resulting in strong growth
in SaaS revenues.
"Based on our historical performance in challenging times, the proven track
record of our offering, its ability to find hidden capacity and optimise
costs, we firmly believe our solutions will play an integral role in helping
new and existing customers deal with the challenges posed by a recession."
"Our high levels of recurring revenue and a robust balance sheet mean we are
well placed to mitigate potential economic headwinds while continuing to
invest in the business and execute our growth plans. With a number of contract
wins and expansion deals on the horizon as planned, and an expanding product
offering, we look to the future with confidence."
For more information, please contact:
ActiveOps Via Alma PR
Richard Jeffery, Chief Executive Officer www.activeops.com (http://www.activeops.com/)
Patrick Deller, Chief Financial Officer
Investec Bank plc +44 (0)20 7597 5970
Corporate Broking & PLC Advisory
Patrick Robb / David Anderson
Alma PR + 44(0) 203 405 0205
Caroline Forde / Lily Soares Smith / Will Ellis Hancock
About ActiveOps
ActiveOps is a leader in Management Process Automation (MPA), providing a SaaS
platform to large enterprises with complex and often global back-offices. The
Group's software and embedded back-office operations management methodology
enables enterprises to adopt a data-driven, scientific approach to organising
work and managing capacity.
The Group's enterprise platform comprises its MPA software products
and AOM, the Group's operations methodology and framework for effective
back-office management. Together, this combination of software and embedded
methodology enables operations managers to balance the competing priorities of
meeting service and quality standards while improving productivity and
reducing cost.
As at 30 September 2022, the Group has 180 employees, serving its global
customer base of over 80 enterprise customers from offices in the UK, Ireland,
USA, Australia, India and South Africa. The Group's customers are
predominantly in the banking, insurance and business process outsourcing (BPO)
sectors, including Nationwide, TD Bank, Anthem Inc and DXC Technology.
CEO Statement
I am pleased to report on a period of continued growth, with the Group trading
in line with the Board's expectations for the full year. We continue to
execute on our land and expand sales strategy to grow our customer base by
extending the range of products used by existing customer environments as well
as expanding into new areas. The success of the approach is evidenced in the
signing of new WorkiQ and ControliQ customers during the period, generating a
significant opportunity to cross sell, alongside substantial expansion deals
across our product offering and territories. The newly launched CaseworkiQ
product has already proven its ability to open-up new environments within our
existing customers, including the signing of our first major CaseworkiQ
contract with a leading UK banking customer, demonstrating the scale of the
upsell opportunity. A pipeline of opportunities for CaseworkiQ has been
established and is growing both for existing and new customers.
The investments we made in FY22 have allowed us to continue to deliver against
our ambitious product roadmap, with a focus on the introduction of Machine
Learning capabilities which further enhance the efficiency and engagement
benefits of our solutions. We remain committed to developing cutting edge
technologies which make a tangible difference to the performance of our
customers as they navigate the ever-changing world of work. In an uncertain
macro-economic environment ActiveOps provides large organisations with the
ability to optimise their staff costs and find hidden capacity amongst their
teams. We are confident that the solutions we provide continue to resonate
amongst our target customers and believe we are well positioned to help
companies mitigate the impact of an anticipated economic down turn, as
demonstrated by our successful performance during previous times of recession.
Strong financial performance
New customer wins together with substantial expansion deals with existing
customers have resulted in strong growth in SaaS revenues of 14% to £10.9m,
driving a 12% growth in exit Annual Recurring Revenue (ARR) to £22.1m
(September 2021: £19.8m) and demonstrating the strength of the Group's
recurring revenue business model. Overall Group revenue grew 7% in the period
to £12.3m (H1 2021: £11.5m), with the strong SaaS performance marginally
offset by a small decline in Training and Implementation revenues in the
period, due to the volatility of this revenue, timing of contract signings,
and implementation timeframes. The Board is confident that T&I revenue
will return to prior levels for the full financial year, aided by customer
signings since period end, including a record T&I sale, although these
will still be subject to delivery timings. The Group delivered a stronger than
expected profit performance, marginally above breakeven at the adjusted EBITDA
level (H1 2021: loss (£0.2m), largely reflecting the positive impact of
currency movements in the period and continued careful cost-management.
The business remains well funded with a closing cash balance of £11m,
providing us with a strong base from which to execute our investment roadmap,
making considerable advances in areas of artificial intelligence (AI) and
automation, that allows the Group to remain at the forefront of the market.
Growing market opportunity
Our growth opportunity given the current economic climate, continued trend
towards hybrid-working and the resulting increase in the requirement for our
offering, underpins our prospects as a business. With a recession on the
horizon, organisations will need to achieve more with their current or perhaps
reduced capacity, as well as respond quickly to unusual fluctuations in
customer demand and behaviour.
Our solutions have a demonstrable track record of delivering rapid,
sustainable performance improvements for our customers. Customers typically
achieve a productivity improvement of 15% or higher, which for an organisation
with 20,000 staff in back-office roles, represents creation of capacity
equivalent to 2,600 full-time equivalent (FTE) staff members. Our software
also increases agility and resilience in our customers' operations,
capabilities which are crucial in the maintenance of exceptional customer
service during turbulent periods, when the volume and nature of workloads can
fluctuate in very unusual ways.
Unlike many of the initiatives organisations can undertake to increase
efficiency and release capacity, deployment of ActiveOps solutions is quick
and low risk as it does not require modification of business processes or
major technology change. Adoption rates of Management Process Automation
technology are also relatively low in operations today, meaning many
organisations still have this rapid and safe means of efficiency gains
available to them.
Our experience during the last severe economic downturn was that demand for
our offering increased significantly as organisations sought solutions which
offered rapid and sustainable performance improvements. From January 2008
through to December 2010 the number of paying users of our software grew
sixfold as we signed major new customers in both APAC and EMEIA and landed our
first North American customers, which have now expanded to be enterprise scale
users.
While we know that our offering resonates in turbulent times, we are also
aware of the impact an economic downturn might have on the buying processes of
our customers, which will likely become more protracted. However, based on our
historical performance, the proven track record of our offering and the
growing interest we are seeing across our products, we firmly believe our
solutions will play an integral role in helping new and existing customers
deal with the challenges posed by a recession.
Product development and innovation
The development of our product offering has continued to accelerate in the
first half of the year, in line with our stated product road map. The
innovations we have made across the product suite will provide customers with
increasingly sophisticated tools that are able to help manage the growing
complexity of the back-office and differentiate us from competitors.
ControliQ
Developments to our cloud delivered workforce optimisation tool, ControliQ
were made across the period with a particular focus on new reporting/insight
for senior managers overseeing large operations. The major focus of our
current development effort and roadmap for the remainder of the financial year
is the launch of several new features which harness the power of Machine
Learning (ML).
This is cutting edge technology which will help our customers further increase
the performance benefits from using our solutions, whilst also reducing the
time and effort needed to operate our software. Smart Planning, our first ML
powered capability, eliminates the time and thought required by team leaders
to build their plans, and increases the accuracy of the plans produced,
leading to further increases in performance. Smart Planning will be quickly
followed by Skills Management, the automatic determination of available skill
levels across the back office, making it simple to identify training
requirements and utilise shared skills across departments. Prototypes of both
have been tested with existing customers with extremely positive results. A
focus for the remainder of FY23 is making these features ready for general
release.
WorkiQ
The evolution of WorkiQ continued in the first half of the year with a focus
on enhancements requested by existing users. Ongoing developments include
new reports/insights and creation of a fully cloud hosted version.
CaseworkiQ
The Group's latest offering, CaseworkiQ was launched during the period in
response to the growing levels of complex case-based work in back-office
operations. CaseworkiQ is already proving to be highly applicable within the
existing customer base, presenting a considerable upsell opportunity including
many highly regulated environments, where the pressure to act is significantly
increased. An early contract-win worth approximately £0.6m in incremental
Annual Recurring Revenue (ARR) with a leading UK bank and existing ControliQ
customer, clearly demonstrates the upsell potential of the product.
Growth of our customer base: Land & expand
We have identified a total addressable market for our solutions within our
target markets of over £950m in ARR, expanding from £750m prior to the
launch of CaseworkiQ, of which £90m relates to the cross and upsell of our
solutions to our existing customers. We remain focussed on expanding our
footprint in our existing customer base whilst delivering against our customer
acquisition strategy, which is tightly focussed on banks, insurers and BPOs in
our target geographies.
The Group secured three new customers in the first half and twelve significant
customer expansion deals. Performance was particularly strong in the Asia
Pacific and EMEIA regions. Retention rates remain strong across all
territories, as the transition to hybrid working continues to reinforce demand
for workforce management solutions and data-driven management.
Sales and Marketing
We were delighted to welcome Bhavesh Vaghela to the Group in the period, as
Chief Marketing Officer, a senior marketing executive with over 20 years of
experience providing strategic leadership, marketing, sales and operations in
technology markets.
Our recent annual customer conference Capacity 22 - 'Do more with less during
turbulent times', was held on 12 October at The Science Museum and brought
together customers, partners and industry commentators. Attendance was more
than double that of the previous year's event and the level of engagement from
customer and prospects was exceptional. This signals the health of our
market and the appreciation of the important role our solutions can play in
helping operations thrive during what is likely to be challenging next period.
Alongside our direct sales activities, we continue to work with partners and
extended our partnership with Microsoft in the Period, including integration
of our products within Teams and securing top tier status as an ISV partner.
Focus for FY23
The significant investments that were made in the prior year in sales, R&D
and marketing have provided us with the capability to successfully execute
against our growth strategy. Our focus is on capitalising on these investments
and converting the significant levels of existing pipeline.
We remain committed to delivering our exciting roadmap of innovations, with
the launch of Smart Planning scheduled for the current quarter, and will
continue to make considerable advances in the deployment of Artificial
Intelligence (AI) and automation, providing customers with solutions to
increasingly more complex issues.
These product innovations, together with the implementation of our refreshed
marketing strategy will further establish our differentiation versus our
competitors, increasing our ability to drive the expansion of the business and
deliver results for our shareholders.
Confident Outlook
Trading in the second half has begun well, keeping the Company firmly on
target to be run rate EBITDA positive at the end of this current financial
year.
With products that are more relevant than ever, high levels of recurring
revenue and a robust balance sheet, we are well placed to mitigate potential
economic headwinds while continuing to invest in the business and execution of
our growth plans. With a number of contract wins and expansion deals on the
horizon as planned, and an expanding product offering we look to the future
with confidence.
Richard Jeffery
Group Chief Executive Officer
Chief Financial Officer's Report
Financial Review
I am pleased to report a good financial performance by the Group for the first
half of the year, growing ARR, software and subscription revenue, delivering a
small adjusted EBITDA profit with a strong cash position for the Group.
Revenue
Annual Recurring Revenue ('ARR') is a key performance metric for the Group.
Included within ARR are software licence fees along with small amounts of
recurring support revenue where a customer has purchased an ongoing care
package.
ActiveOps' ARR at 30 September 2022 totalled £22.1m (30 September 21
£19.8m), representing year-on-year growth of 12%, delivered through the
expansion of our footprint in existing customer accounts and sales to new
customers.
Total revenue for the Group at £12.3m (H1 FY21: £11.5m) was 7% ahead of the
same period last year with recurring software and subscription revenues
increasing by 14% to £10.9m (H1 FY22: £9.6m) on a reported basis.
Training and Implementation ('T&I') revenues at £1.4m (H1 FY22: £1.9m)
were behind prior year primarily due to timing of implementations being
delayed or extended by customers as well as slow T&I sales at the end of
FY22 that meant that the pipeline of T&I work at the beginning of the
first half of the year was lower.
Operating Profit and Margins
Gross margins stayed steady at 81% (H1 FY22: 80%). Software and Subscription
margins were broadly flat at 84% (H1 FY22: 85%). T&I margins were strong
at 59% (H1 FY22: 56%) as a result of significant high margin implementations
across a range of customers. T&I revenues and margins vary according to
the product mix (between WorkiQ, ControliQ and CaseworkiQ), the location of
implementations (with higher cost jurisdictions delivering a higher margin),
and the level of support required by ActiveOps coaches on each delivery. The
period saw an ongoing higher mix of EMEIA ControliQ implementations that
resulted in a higher margin than the prior year.
Operating expenses (excluding share-based payments, depreciation and
amortisation) increased by 4% to £9.7m (H1 FY22: £9.3m) with a significant
foreign exchange gain on US Dollar's held in the company bank accounts.
Investment made in sales, marketing and technology development in the prior
year had a run rate impact on operating costs in the half. Wage inflation
remains as expected with ongoing investment steadying into the second half.
Adjusted EBITDA was a positive £0.3m (H1 FY22: loss (£0.2m)), being ahead of
management's expectations primarily due to the foreign exchange impact of
translating bank balances to GBP.
Foreign Exchange
The Group has 53% (H1 FY22: 54%) of revenues invoiced in currencies other than
GBP. Exchange rates have been volatile over the period with a strengthening
of the US Dollar, Canadian Dollar and Australian Dollar versus sterling.
Product and Technology Expenditure
Total expenditure on product management, research, development and support in
the year increased to £2.5m (H1 FY22: £2.0m) as investment made in FY22
rolled into the current year. Capitalised labour of £0.3m related to the
development of new product features including smart planning and skills
management features.
Depreciation & Amortisation
Depreciation & amortisation of £0.5m (H1 FY22: £0.5m) principally
comprised intangible amortisation following the acquisition of the OpenConnect
entity in 2019 and the Australian entities in 2017.
Taxation
The Group operates a transfer pricing policy to ensure that profits are
correctly recorded in each of the jurisdictions in which it operates.
ActiveOps has brought forward tax losses in the UK and Irish legal entities.
Statutory Results
The Group reported a loss for the period of £0.6m (H1 FY22: loss of £1.0m).
Earnings per Share
Basic Earnings per Share for continuing operations was a loss of 0.99p (H1
FY22: (1.40p)).
Dividend
The Board has determined that no dividend will be paid in the period. The
Group is primarily seeking to achieve capital growth for shareholders. It is
the Board's intention during the current phase of the Group's development to
retain distributable profits from the business to the extent they are
generated.
Cash flow
Cash flow from operations in the first half of the year was negative (£1.6m).
The negative cashflow position in H1 is attributable to the phasing of
renewals over the year with a significant level of renewals expected in the
second half of the year and the timing of payments of annual in advance bills
significantly impact the cash position at 30 September 2022. The Group
issued invoices totalling £2m in the last week of September 2022 and first
week of October 2022 and had cash of £13.0m at 28 November 2022.
Balance Sheet
The Group has maintained a strong balance sheet position with a net cash
position of £11.0m (H1 FY22: £10.9m) and net assets at 30 September 2022 of
£8.3m, (30 March 2022: £8.5m).
Management Statement
This Interim Management Report (IMR) has been prepared solely to provide
additional information to shareholders to assess the Group's strategies and
the potential for those strategies to succeed. The IMR should not be relied on
by any other party or for any other purpose.
The IMR contains certain forward-looking statements. These statements are made
by the Directors in good faith based on the information available to them up
to the time of their approval of this report but such statements should be
treated with caution due to the inherent uncertainties, including both
economic and business risk factors, underlying any such forward-looking
information.
By the order of the Board
28 November 2022
ActiveOps plc
Consolidated statement of profit and loss and other comprehensive income for
the period to September 2022
Six months ended 30 September 2022 Six months ended 30 September 2021
Notes £000 Unaudited £000 Unaudited
Revenue 3 12,291 11,451
Cost of sales 4 (2,288) (2,293)
Gross profit 10,003 9,158
Administrative expense excluding share options charges, depreciation, (9,662) (9,332)
amortisation and exceptional items
Administrative expense - share option charges only (390) (283)
Administrative expense - depreciation and amortisation only (523) (503)
Operating loss (572) (960)
Finance income 2 1
Financing costs (36) (32)
Loss before taxation (606) (991)
Taxation 5 (104) (6)
Loss for the year from continuing activities (710) (997)
Profit for the year from discontinued activities, net of tax - -
(Loss) / profit for the period (710) (997)
Other comprehensive income
Items that may be subsequently reclassified to profit or loss:
Exchange differences on translating foreign operations 120 (37)
Total comprehensive (loss) / income for the period attributable to the owners (590) (1,034)
of the parent company
Basic and diluted (loss) / earnings per share 6 (0.99p) (1.40p)
ActiveOps plc
Consolidated statement of financial position
At 30 September 2022 At 31 March 2022
Notes £000 Unaudited £000 Audited
Non-current assets
Intangible assets 5,823 5,461
Property, plant and equipment 182 199
Right-of-use assets 493 564
Deferred tax assets 270 270
Total non-current assets 6,768 6,494
Current assets
Trade and other receivables 7 3,937 3,754
Corporation tax recoverable - -
Cash and cash equivalents 10,976 13,753
Total current assets 14,913 17,507
Total assets 21,681 24,001
Equity
Share capital 71 71
Share premium account 6,444 6,444
Share option reserve 956 566
Foreign exchange reserve 77 (43)
Retained earnings 770 1,480
Total equity 8,318 8,518
Non-Current liabilities
Lease liabilities 424 501
Provisions 114 97
Deferred tax liabilities 1,031 1,049
Total non-current liabilities 1,569 1,647
Current liabilities
Trade and other payables 8 11,669 13,697
Lease liability 125 139
Total current liabilities 11,794 13,836
Total equity and liabilities 21,681 24,001
ActiveOps plc
Consolidated statement of cash flows
Six months ended 30 September 2022 Six months ended 30 September 2021
Notes £000 Unaudited £000 Unaudited
(Loss) / profit after tax (710) (997)
Taxation 104 6
Finance income (2) (1)
Financing costs 36 32
Operating (loss) / profit (572) (960)
Adjustments for:
Depreciation property, plant and equipment 64 76
Depreciation right-of-use asset 72 90
Amortisation of intangible assets 387 337
Share option charge 390 283
Change in trade and other receivables 7 183 (283)
Change in trade and other payables 8 (2,028) (4,867)
Cash (used in) / from operations (1,504) (5,324)
Interest paid (13) (32)
Taxation paid (129) (78)
Net cash used in operating activities (1,646) (5,434)
Investing activities
Purchase of property, plant and equipment (40) (49)
Purchase of software (316) -
Interest received 2 1
Net cash used in investing activities (354) (48)
Financing activities
Proceeds from issue of shares - 15
Repayment of lease liabilities (111) (135)
Repayment of bank borrowings - -
Net cash used in financing activities (111) (120)
Net change in cash and cash equivalents (2,111) (5,602)
Cash and cash equivalents at beginning of the period 13,753 16,617
Effect of foreign exchange on cash and cash equivalents (666) (100)
Cash and cash equivalents at end of the period 10,976 10,915
ActiveOps plc
Consolidated statement of changes in equity
Share capital Share premium Share option reserve Foreign exchange reserve Retained earnings Total
£000 £000 £000 £000
At 31 March 2021 (audited) 71 6,430 4 (204) 4,210 10,511
Loss for the period - - - - (997) (997)
Exchange differences on translating foreign operations - - - (37) - (37)
Total comprehensive loss for the period - - - (37) (997) (1,034)
Transactions with owners, recorded directly in equity
Reserve transfer on exercising of share options - - (1) - 1 -
Share based payment charge - - 283 - - 283
Issue of shares - 14 - - - 14
Total transactions with owners - 14 282 - 1 297
At 30 September 2021 (unaudited) 71 6,444 286 (241) 3,214 9,774
At 31 March 2022 (audited) 71 6,444 566 (43) 1,480 8,518
Loss for the period - - - - (710) (710)
Exchange differences on translating foreign operations - - - 120 - 120
Total comprehensive loss for the period - - - 120 (710) (590)
Transactions with owners, recorded directly in equity
Share based payment charge - - 390 - - 390
Total transactions with owners - - 390 - - 390
At 30 September 2022 (unaudited) 71 6,444 956 77 770 8,318
ActiveOps plc
Notes forming part of the interim financial statements for the period ended 30
September 2022
1. General information
ActiveOps plc ('the Company') is a public company limited by shares
incorporated in England and Wales. The registered office and principal place
of business is One Valpy, 20 Valpy Street, Reading, Berkshire, RG1 1AR.
The Company, together with its subsidiary undertakings ('the Group') is
principally engaged in the provision of hosted operations management Software
as a Service ('SaaS') solutions to industry leading companies around the
world.
2. Accounting policies
a) Basis of preparation
The Interim financial report for the six months ended 30 September 2022 has
been prepared on the basis of the accounting policies expected to be adopted
for the year ended 31 March 2023. These are in accordance with the accounting
policies as set out in the Group's last annual consolidated financial
statements for the year ended 31 March 2022.
The Interim financial report has been prepared on a going concern basis and in
accordance with the presentation, recognition and measurement criteria of
UK-adopted International Accounting Standards.
The financial information in the Interim financial report does not constitute
statutory accounts, within the meaning of section 434 of the Companies Act
2006, for the six months ended 30 September 2022 and should be read in
conjunction with the Group's consolidated financial statements for the year
ended 31 March 2022. The consolidated financial statements for the year ended
31 March 2022 have been filed with the Registrar of Companies, were
unqualified and did not contain statements under Section 498 (2) or (3) of the
Companies Act 2006.
All figures presented are rounded to the nearest thousand, unless stated
otherwise.
b) Going Concern
The Directors have a reasonable expectation that there are no material
uncertainties that cast significant doubt about the Group's ability to
continue in operation and meet its liabilities as they fall due for the
foreseeable future, being a period of at least 12 months from the date of
approval of the interim financial statements. During the period, the Group has
retained a significant cash balance. This ensures that the business remains
financially robust, with strong prospects for the future.
Whilst there can be no certainty due to the conditions across the world at
present, the Directors have reviewed cash flow forecasts for the business
covering a period of at least 12 months from the date of approval of the
financial statements, and together with the projected revenue and available
cash reserves, they are confident that sufficient funding is available to
support ongoing trading activity and investment plans for the business. The
financial statements have, therefore, been prepared on a going concern basis.
3. Revenue
The Group derives all its revenue from the transfer of goods and services.
A disaggregated geographical split of revenue by operating segment is shown
below between Europe, the Middle East, India and Africa ('EMEIA'), North
America and Australia. All revenue streams are recognised over time.
SaaS T&I Total
Six months ended 30 September 2022 £000 £000 £000
EMEIA 5,470 984 6,454
North America 3,013 21 3,034
Australia 2,455 348 2,803
10,938 1,353 12,291
SaaS T&I Total
Six months ended 30 September 2021 £000 £000 £000
EMEIA 4,982 1,171 6,153
North America 2,462 217 2,679
Australia 2,144 475 2,619
9,588 1,863 11,451
4. Segmental analysis
The Group has two reporting segments, being SaaS and T&I. The Group
focuses its internal management reporting predominantly on revenue and cost of
sales. Total assets and liabilities are not provided to the CODM in the
Group's internal management reporting by segment and therefore a split has not
been presented below. Information about geographical revenue by segment is
disclosed in note 3.
SaaS T&I Total
Six months ended 30 September 2022 £000 £000 £000
Revenue 10,938 1,353 12.291
Cost of sales (1,732) (556) (2,288)
9,206 797 10,003
SaaS T&I Total
Six months ended 30 September 2021 £000 £000 £000
Revenue 9,588 1,863 11,451
Cost of sales (1,468) (825) (2,293)
8,120 1,038 9,158
5. Taxation
Six months ended 30 September 2022 Six months ended 30 September 2021
£000 Unaudited £000 Unaudited
Current income tax
Foreign current tax on profit for the current period 123 36
Foreign current tax on profit for the prior period - 2
Deferred tax
Origination and reversal of timing differences (19) (32)
Total tax charge 104 6
Six months ended 30 September 2022 Six months ended 30 September 2021
£000 Unaudited £000 Unaudited
Loss before tax (606) (991)
Tax at domestic rate of 19% (2021: 19%) (115) (188)
Effect of:
Expenses that are not deductible in determining taxable profit 17 21
Deferred tax not recognised 232 185
Adjustments in respect of prior periods - 2
Effect of other tax rates (30) (14)
Total tax charge 104 6
6. Earnings per share
Six months ended 30 September 2022 Six months ended 30 September 2021
Unaudited Unaudited
Loss on continuing activities (£000) (710) (997)
Profit on discontinued activities (£000) - -
Weighted average number of shares in issue in the period 71,364,180 71,334,942
Basic and diluted (loss) / earnings per share (0.99p) (1.40p)
7. Trade and other receivables
At 30 September 2022 At 31 March 2022
£000 Unaudited £000 Audited
Trade receivables 3,034 2,723
Prepayments and accrued income 824 953
Other receivables 79 78
3,937 3,754
The Directors consider the carrying value of trade and other receivables to be
approximately equal to their fair value.
At 30 September 2022 At 31 March 2022
£000 Unaudited £000
Audited
Trade receivables from contracts with customers 3,080 2,770
Less loss allowance (46) (47)
3,034 2,723
Trade receivables are amounts due from customers for services performed in the
ordinary course of business. They are generally due for settlement within 30
days and are therefore all classified as current. Trade receivables are
recognised initially at the amount of consideration that is unconditional. The
Group holds the trade receivables with the objective of collecting the
contractual cash flows, and so it measures them subsequently at amortised cost
using the effective interest method.
8. Trade and other payables
At 30 September 2022 At 31 March 2022
£000 Unaudited £000
Audited
Trade payables 6 1,326
Other taxation and social security 794 815
Other payables 7 3
Accruals and deferred income 10,862 11,553
11,669 13,697
Trade payables are unsecured and are usually paid within 30 days of
recognition. The carrying amounts of trade and other payables are considered
to be the same as their fair values, due to their short-term nature.
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