REG - Alfa Financial Soft - H1 Trading update

Alfa Financial Software HoldingsAnnouncement

24/07/2024 07:00

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RNS Number : 5376X  Alfa Financial Software Hldgs PLC  24 July 2024

24 July 2024

 

Alfa Financial Software Holdings PLC

H1 Trading update

Continued momentum in pipeline, full year expectations unchanged

 

Alfa Financial Software Holdings PLC ("Alfa" or the "Company"), a leading
developer of mission-critical software for the asset finance industry provides
a scheduled update on trading for the half year ended 30 June 2024. The
half-year results are expected to be announced on Thursday 5 September 2024.

 

Strong operational performance

In the second quarter we have continued our excellent delivery track record
for our customers with six customer deliveries, following on from the seven
deliveries in the first quarter.

We have continued to invest in our product, focusing on completing the
development of the ten new modules included in Alfa Systems 6.  In the second
quarter we released the fourth of six instalments of Alfa Systems 6 -
"Scalability", which delivers leading-edge functionality designed for
customers looking to scale their business with flexibility and speed. Alfa
Systems 6 runs on new, more adaptable cloud technologies, makes it easier to
expand into new markets, simplifies the migration of newly acquired portfolios
onto Alfa and allows true 24-hour operations across multiple time zones.

 

Continued pipeline progression

Following the signing of full contract packs for two significant prospects in
the first quarter, we have added two new prospects to the late-stage pipeline
in the second quarter: a UK Alfa Start customer and an existing Asia Pacific
v4 customer. There are now eleven prospects in our late-stage pipeline and we
are providing services to eight of these under letters of engagement, up from
six in the first quarter.

We remain very confident in the overall strength of the pipeline from early
stage through to late stage. Whilst employee retention has remained high, we
have also increased our recruitment targets in EMEA and the US this year to
accommodate this strong pipeline.

After strong TCV growth in Q1 driven by the conversion of two new customers,
TCV at the end of Q2 was in line with Q1. This is significantly above year end
and up more than 35% compared with this time last year.

 

Trading as expected, expectations unchanged

Trading in Q2 was in line with our expectations and the Board continues to
expect mid to high single digit revenue growth for the full year.

As previously highlighted, 2023 revenue weighting was unusual because we had a
particularly strong H1. For 2024, we continue to expect a more typical
revenue pattern for the year. Overall H1 revenues were in line with last
year's strong first half on a constant currency basis, and we expect strong
revenue growth in H2.

In the first half, subscription revenues continued to grow strongly with high
teens growth versus last year. Subscription sequential growth also continued
with Q2 revenues growing by high single digits versus Q1. Software revenues
were significantly lower than last year due to the focus on investment in Alfa
Systems 6 functionality, as highlighted at the time of the Q1 trading update.
Services revenues were slightly down on last year but we anticipate a reversal
in the second half of this year as new projects increase their allocated
resources.

 

Andrew Denton, Chief Executive Officer of Alfa, said:

"We are pleased with our performance in the first half of the year and are
looking forward to an exciting second half of the year with several
significant projects ramping up and the release of the final two pillars of
Alfa Systems 6. This combined with strong sequential growth in Subscription
revenues and an encouraging late-stage pipeline means we are well placed to
achieve our expectations for the year and remain confident in the longer-term
outlook for the business.

 

 

 

 

 

 

 

Enquiries

 

 Alfa Financial Software Holdings PLC      +44 (0)20 7588 1800
 Andrew Denton, Chief Executive Officer

 Duncan Magrath, Chief Financial Officer

 Andrew Page, Executive Chairman

 Teneo                                     +44 (0)20 7353 4200
 James Macey White

 Victoria Boxall

 Barclays                                  +44 (0)20 7623 2323
 Robert Mayhew

 Anusuya Gupta

 Investec                                  +44 (0)20 7597 4000
 Patrick Robb

 Virginia Bull

 

 

 

Notes to Editors

 

Alfa has been delivering software systems and services to the global asset and
automotive finance industry since 1990.  Our agile methodologies and
specialised knowledge of asset and automotive finance enables the delivery of
large software implementations and highly complex business change projects.
With an excellent delivery track record now into its fourth decade, Alfa's
experience and performance is unrivalled in the industry.

 

Alfa Systems, our class-leading technology platform, is at the heart of some
of the world's largest asset and automotive finance companies. Alfa Systems
supports both retail and corporate business for auto, equipment, wholesale and
dealer finance on a multijurisdictional basis, including leases/loans,
originations and servicing. A cloud-native, end-to-end solution with
integrated workflow and automated processing using business rules, Alfa
Systems provides compelling solutions to asset finance companies.

 

Alfa Systems is currently live in 37 countries.  Alfa has offices in Europe,
Australasia and North America.  For more information, visit
www.alfasystems.com (http://www.alfasystems.com) .

 

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