REG - Aptitude Software - Audited Results for Year Ended 31 December 2023
21/03/2024 07:00
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RNS Number : 6935H Aptitude Software Group PLC 21 March 2024
21 March 2024
APTITUDE SOFTWARE GROUP plc
('Aptitude' or 'the Group')
Audited Results for the Year Ended
31 December 2023
Aptitude (LSE: APTD), a market-leading provider of finance transformation
software solutions, specialising in autonomous finance, reports its Audited
Results for the year ended 31 December 2023.
Financial Highlights
Year ended 31 December 2023 2022 % Change
Annual Recurring Revenue(1, 2) ('ARR') at year end £51.1m £50.2m(2) 2%
Revenue
Total Revenue £74.7m £74.4m -
- Recurring Revenue(3) £53.4m £50.5m 6%
- Non-Recurring Revenue £21.3m £23.9m (11%)
Profit and EPS
Adjusted Operating Profit(4) £9.7m £7.5m 29%
Statutory Operating Profit £5.3m £3.7m 43%
Adjusted Operating Margin(4) 13% 10% 3%
Basic Earnings per Share 7.2p 4.5p 60%
Cash and Balance Sheet
Cash and cash equivalents at year end £34.1m £29.2m 17%
Net funds(5) £22.7m £15.9m 43%
Final Ordinary Dividend per Share 3.6p 3.6p -
Full Year Ordinary Dividend per Share 5.4p 5.4p -
· Adjusted Operating Profit grew by 29% to £9.7m (2022: £7.5m).
· Year on year constant currency growth in ARR of 2% with headline growth rates
moderated by continuing churn in Subscription, Billing and Revenue Management.
· Despite a reduction in non-recurring revenue of £2.6m (11%), total revenue
remained steady at £74.7m, an increase of £0.3m from the prior year as a
result of the increase in higher quality, recurring revenue.
· Recurring Revenue, the strategic priority of the Group, grew 6% to £53.4
million (2022: £50.5 million), representing 71% of total revenue (2022: 68%).
· Continued balance sheet strength, with cash of £34.1m (2022: £29.2m) and Net
Funds(5) of £22.7m (2022: £15.9m). Cash conversion remains a key strength
and is improving with the increase in recurring revenue and an improving
operating margin.
· As announced separately today, the Board has approved a share buyback
programme of up to £20m over three years as part of a programme of enhanced
returns. The Group's robust balance sheet provides the opportunity to take
advantage of the prevailing market conditions to repurchase shares at
advantageous levels, while maintaining the necessary investment to support the
organic growth of the business.
· Maintained full year dividend of 5.4p per share.
Strategic Progress:
· Appointment of new executive team, with both CEO and CFO roles filled by
internal candidates, who have tenure with the organisation and strong
operational and market experience.
· Executive team appointed to ensure Aptitude can complete the shift from a
business set up to sell regulatory compliance software to an organisation
delivering an intelligent finance data management and accounting platform.
· This shift is required to execute against the significant global opportunity
for the Fynapse platform supported by our strategic partnerships who recognise
how Aptitude is uniquely positioned to help them capitalise on the AI
autonomous finance opportunity.
· The acceleration of our partner strategy is already delivering results, with
increased partner pipeline and marketing activity.
· Upon appointment, the CEO completed an organisational review, which has
concluded the need for organisational realignment to support the opportunity
with Fynapse and partners.
· The following is being implemented to support this:
o Strategic refocus and linked objectives aligning the entire organisation to
execute on the Fynapse opportunity, mitigating client churn and scaling
through partners.
o Alignment of product and technology with the recent appointment of a Chief
Product and Technology Officer.
o Implementation of a global and Fynapse partner led go-to-market team.
o Robust churn mitigation solutions being implemented across the Group.
o Refocus of the partner programme to build stronger and deeper relationships
with a smaller number of critical partners to drive velocity of deals.
o Performance management reframed around objectives and key results ('OKRs')
supporting the Group's refreshed Fynapse and partner led strategy.
The Fynapse Opportunity
· Fynapse provides clients with a differentiated offering enabling CFOs to move
from closing the books, to supporting their full Autonomous Finance vision and
subsequent elevation to strategic advisor of the business.
· Fynapse provides organisations with the ability to support this transformation
rapidly (months vs. years) and cost effectively when compared to other vendors
in the market.
· Fynapse provides Aptitude with an expanded go-to-market opportunity via the
ability to continue to serve the Tier 1 market as well as Tier 2 and 3 and
additional sector types.
· Fynapse also significantly expands the opportunity with partners as it
delivers immediate value to their clients, which opens up multiple channel
types, and therefore will drive an increased velocity of deals for the Group.
· Importantly, Fynapse provides a cutting-edge technology foundation that is
designed for AI and designed to hold vast quantities of information to support
the insights of the CFO.
· Underpinning our confidence in long-term growth is the traction Fynapse
continues to gain in the market, represented by pipeline progression and the
acceleration and commitment by key partners to jointly go-to-market on their
vision for AI Autonomous Finance. As an example, Aptitude and Microsoft
continue to build on the existing relationship. Alongside its recently
launched Copilot for Finance, Fynapse has been identified as a key component
to Microsoft's AI and Autonomous Finance ERP strategy, enabling a single view
of business and finance data with high processing speeds, supporting Copilot
for Finance. This is expected to support the momentum of our strategy.
Business Highlights in 2023:
· New business success for our market leading Autonomous Finance platform,
Fynapse to a first new logo client for a multi-year subscription agreement,
complementing the existing Telco charter client.
· Multi-year renewal for Subscription Management offering, eSuite providing
complementary revenue stream and cross sale potential.
· Continued new customer momentum with other Compliance and Finance
Transformation offerings including a multi-year agreement to provide the
Aptitude Insurance Calculation Engine to a UK government agency.
· A material new multi-year agreement with an existing global Financial Services
client to take Aptitude Assure, the Group's recurring managed services
solution.
Outlook:
· Fynapse increases Aptitude's go-to-market opportunity, but selling a broader
platform offering like Fynapse needs alternative skills and business
expertise. The organisational realignment is expected to be completed across
2024 to ensure the business is fully ready to capitalise on the market
opportunity with Fynapse, supported by a more focused partner community.
· We have seen macroeconomic conditions continue to impact churn and investment
decisions, resulting in lengthening sales cycles. However, with Fynapse we
expect to see this change over time. By expanding our go-to-market approach to
include tier 1, 2 and 3 organisations and enhancing our partner channels, this
will lead to shorter sales cycles and a stronger flow of business going
forward.
· These trends will moderate headline revenue this year and profitability is now
expected to be in line with 2023 performance, before returning to more
normalised growth in 2025 and beyond.
· Underpinning our confidence in long-term growth is the traction Fynapse
continues to gain in the market, represented by pipeline progression and the
acceleration, and commitment by key partners, to jointly go-to-market, on
their vision for AI Autonomous Finance.
· The growth in higher quality, recurring revenues through Fynapse with its
cloud native capabilities is also expected over the medium term to generate a
progressive margin benefit for the Group.
· As announced separately today, the Group will be conducting a buyback
programme of £20.0 million over a three-year period. The Group's target of
incremental profitable growth is expected to drive higher returns for
investors in line with the expected growth of Fynapse. The Board view the
buyback programme as providing an enhanced capital return to shareholders.
· The expected growth through the combination of the opportunity with Fynapse,
its partners, and existing clients, coupled with carefully controlled
investment is expected to generate improved returns for shareholders over the
coming years.
Commenting on the results, Alex Curran, Chief Executive Officer, said: -
'2023 represented a year of transition for Aptitude, with the formation of a
new leadership team, a refocused strategy, and the realignment of the
organisation to truly deliver on the Fynapse opportunity and address churn
mitigation.
The refocus will continue, and I expect will complete across 2024, but it will
set the business up for success. It will enable Aptitude to move from directly
selling regulatory and compliance software to a partner led platform
organisation underpinned by Fynapse. This will enable growth through multiple
partner channels which in turn drives a greater number of deals with shorter
sales cycles.
The AI Autonomous Finance market is significant in size and supported by our
strategic partnerships, including Microsoft who recently launched Autonomous
ERP and Copilot for Finance, where Fynapse plays a key role.
This provides confidence in the outlook for the Company and the ability of the
Group to return to growth in 2025 and beyond.'
Contacts
Aptitude Software Group plc
Ivan Martin,
Chairman
020-3687-3200
Alex Curran, Chief Executive Officer
Mike Johns, Chief Financial Officer
Alma Strategic Communications
Caroline Forde / Hilary
Buchanan
020-3405-0205
About Aptitude
Aptitude Software provides software solutions that deliver fully autonomous
finance to enable its clients to drive growth, efficiency and sustainability.
Fynapse is Aptitude's intelligent finance data management and accounting
platform designed to increase productivity and lower costs for finance teams
globally. Fynapse provides a single view of finance and business data,
unparalleled performance and automation, faster and better insights,
user-friendly functionality and market-leading total cost of ownership.
www.aptitudesoftware.com (http://www.aptitudesoftware.com)
Prior to publication the information communicated in this announcement was
deemed by the Company to constitute inside information for the purposes of
article 7 of the Market Abuse Regulations (EU) No 596/2014 as amended by
regulation 11 of the Market Abuse (Amendment) (EU Exit) Regulations No
2019/310 ('MAR'). With the publication of this announcement, this information
is now considered to be in the public domain.
Throughout this announcement:
1 Annual Recurring Revenue ('ARR') is the value of Aptitude's recurring
revenue at a specific point in time, normalised to a one-year period. ARR
includes recurring revenues contracted but yet to commence and excludes
recurring revenues which are currently being received but are known to be
terminating in the future. Included in ARR are recurring revenues from the
Group's solution management services.
2 Constant Currency is calculated by comparing the 2023 results with 2022
results retranslated at the rates of exchange prevailing during 2023.
3 Recurring Revenue includes revenues from the Group's solution management
services.
4 Adjusted Operating Profit and Adjusted Operating Margin exclude
non-underlying operating items, unless stated to the contrary. Further detail
in respect of the non-underlying operating items can be found within Note 2.
5 Net Funds represents cash and cash equivalents less finance obligations,
which includes capital lease obligations and a loan.
Certain non-IFRS financial measures (e.g. Adjusted Operating Profit) are
included which assist management in comparing performance on a consistent
basis.
Chairman's Statement
Overview
2023 marked the transition to a new management team for Aptitude, with Alex
Curran, Chief Executive Officer, and Mike Johns, Chief Financial Officer, both
appointed in the year. Alex and Mike were both internal candidates, who have
tenure with the business and strong operational and market experience to
support the business effectively. Their appointments reflect the strength of
Aptitude's talent management and succession planning.
The team have acted swiftly since their appointments, realigning the Group's
strategy toward the Fynapse opportunity and key strategic partnerships,
refreshing the Senior Leadership Team and flattening and globalising the
Group's organisational structure.
The Fynapse platform enables clients to create a truly autonomous finance
function, through the provision of a centralised finance data cloud and a rich
data foundation for the use of market-leading AI tooling, and it is supported
by modern engines that offer accounting, subledger and calculation
capabilities.
Fynapse will enable Aptitude to move from regulatory and compliance to a
platform organisation.
Highlights in 2023 include:
· The first, post charter client sale of Fynapse to a first new logo client with
a multi-year subscription agreement
· Meeting key market readiness for our Microsoft partnership with integration to
Dynamics 365 and enablement on the Azure cloud platform.
· The go-live of the US telco charter client on Fynapse, providing the
organisation with powerful insights, processing power and significant cost
efficiencies.
The new Senior Leadership Team will drive an increase in momentum which is
reflected in a growing pipeline of Fynapse opportunities and strategic
alignment with partners on their vision for Autonomous Finance. This pipeline
is further supported by our partner community which provides confidence in the
success of the platform over the coming years.
To execute on its strategy and key objectives Aptitude relies on the strength
of its people, and I would like to thank our global team for their hard work
and dedication during a period of significant change for the Group. The Board
is committed to enabling a high-performance culture across Aptitude and
supporting the further development of talent in the organisation.
Dividend and Share Buyback
The Board has proposed an unchanged final dividend of 3.60 pence per share
(2022: 3.60 pence), making a total ordinary dividend of 5.40 pence per share
for the year (2022: 5.40 pence). Subject to shareholder approval at the
Group's Annual General Meeting on 14 May 2024, the proposed final dividend
will be paid on 14 June 2024 to shareholders on the register at 24 May 2024.
As announced separately today Aptitude has commenced an on-market share
buyback programme of up to £20m over three years in line with the newly
adopted capital allocation policy. The buyback programme is in accordance with
the Group's authority to make market purchases of its own Ordinary Shares
granted to it by shareholders on 17 May 2023.
Outlook
We believe the Group is well positioned to capitalise on the Fynapse
opportunity. Fynapse's speed of implementation, lower total cost of ownership
and flexibility compared with larger ERP products provide a strong foundation
for the acceleration of recurring revenue growth and a quicker benefit for our
clients.
The strategic partnerships supporting Fynapse also provide Aptitude with the
ability to sell through multiple channels, to multiple sectors, which in turn
will drive a greater velocity of deals.
Additionally, the Group continues to carefully manage its other products
against the macro-economic environment as increased levels of churn continue
to impact the Groups portfolio of products. This combined with the reduction
in implementation services revenues and lengthening of sales cycles will
result in lower overall revenues in 2024. Profitability will be in line with
the performance in 2023 before returning to growth in 2025 and beyond.
Ivan Martin
Chairman
20 March 2024
Chief Executive Officer's Report
Strategic Focus and Organisational Progress
2023 represented a year of realignment for Aptitude and a refocus of the
Group's core strategic aims with Fynapse and strategic partners. Underlying
Aptitude's historic success is the Group's strength in accounting hub and
compliance solutions, which provide the organisation with the knowledge,
skills, experience and credibility of delivering for the office of the CFO.
This experience based on our heritage provides the base for the exciting
opportunity ahead with Fynapse, the Group's intelligent finance data
management and accounting platform.
The AI Autonomous Finance opportunity
In the second half of 2023 the Board and Senior Leadership Team conducted a
review of the business, which concluded that a realignment and refocus of the
organisation around the Fynapse and partner opportunity was required. This
reflects the transition away from selling compliance and regulatory software
to being a platform organisation and being able to take advantage of the
significant AI Autonomous Finance market which Fynapse underpins. To support
this transition, we have implemented a global approach to go-to-market
designed to drive momentum.
Fynapse underpins AI Autonomous Finance which is a self-learning and
self-improving finance function, powered by interoperable AI and cloud
technologies. Autonomous Finance is a partner to the finance professional,
advising on logical next steps and recommendations based on real data and
trends in their organisation. Autonomous Finance frees finance from
repetition, transforming the CFO office into a strategic and business enabler.
Investment levels have been maintained for eSuite, the Group's subscription
management solution. eSuite provides a mid-term growth opportunity for the
Group, including supplementing the opportunity presented by Fynapse through
cross-sell activity and the ability to support complex subscription
accounting.
Investment levels across the Group's compliance products have been managed to
support the Group's existing client base, with a priority placed on client
retention and a firm emphasis on the migration to Fynapse.
Organisational realignment to provide ability to realise the opportunity with
Fynapse
To support the opportunity with Fynapse and partners, a new and refreshed
Senior Leadership Team and associated flattened organisational structure has
been implemented across the Group. The new leadership structure includes
specific accountable individuals for Product and Technology, Growth, and
Client Experience globally. This structure will enable a clear focus on
growth, client acquisition and help to support improved long-term retention
across the regions the Group operates in. The Group's Product and Technology
functions have also been recently combined supporting an end-to-end design and
engineering approach.
Following the launch of the new strategy, the Group adopted a new set of
organisational objectives and key results ('OKRs'), which are regularly
monitored by the Board and SLT, and provide the clarity required to support
organisational progress. The Group's primary objectives over the coming years
will be to deliver the Fynapse growth opportunity, work towards reducing
client churn and scale the organisation through the strength of our key
strategic partnerships.
Key Strategic Partners
Partnerships are the key foundation to Aptitude's scalable growth, and it is a
priority for the Group to increase the proportion of Annual Recurring Revenue
('ARR') generated through a more concentrated group of partners. Included
within this group is a big-4 accountancy firm, which has developed a managed
service offering in partnership with Aptitude and Microsoft. The opportunity
for Fynapse is further expanded by the partnership with Microsoft. This
partnership is expected to be an accelerator of growth going forward and
allows both Aptitude and Microsoft to present an end-to-end solution to
prospects, providing a wider opportunity for Fynapse. Fynapse is the only
platform selected by Microsoft which provides subledger functionality to
support Dynamics 365. Aptitude has worked with Microsoft to roll out Fynapse
sales training to Microsoft's sales representatives. Microsoft and Aptitude's
Autonomous Finance visions are complementary, and the AI functionality
available in Microsoft's platforms further enable Fynapse's capabilities and
market opportunity for both organisations.
Transitioning SaaS business model with enhanced profitability
The Group continues to target an acceleration in the growth of Annual
Recurring Revenue ('ARR') driving an increase in recurring revenues which
currently represent 71% (2022: 68%) of overall revenue. The growth through
Fynapse, both direct and through partners, will generate higher quality
recurring revenues as a result of the cloud native nature of the platform. The
increase in higher quality revenues is expected to generate an overall margin
benefit to the Group, increased profitability, and improved cash conversion.
Software-as-a-Service ('SaaS') ARR now accounts for 46% (2022: 44%) of the
Group's total ARR. Fynapse, with its cloud native capabilities is expected to
enable higher margins to be achieved compared to the Group's existing SaaS
deployed products. The transition to SaaS and improved quality of revenues
will be a continuing process over the coming years and ultimately deliver a
stronger business.
Current spend on research and development is 24% of revenue (2022: 23%). The
Group expenses all research and development through the P&L as incurred,
including the entire development of Fynapse.
The combination of growth in higher margin recurring revenues, the refocus of
the Group's go-to-market approach through strategic partnerships with
Microsoft and others, as well as a controlled and efficient overhead base will
drive the increasing profitability of the Group over the coming years.
Products and Services
The Group benefits from its experience of supporting the office of the CFO.
The Group has aligned the product set around the Fynapse growth opportunity
and will support Aptitude's shift from selling compliance and regulatory
software to a platform organisation underpinned by Fynapse.
AI Autonomous Finance and Finance Transformation
AI Autonomous Finance and finance transformation includes both the Fynapse
platform and the Aptitude Accounting Hub ('AAH').
Aptitude's vision for Autonomous Finance is of a self-learning, and
self-improving, finance function, where tasks are optimized and intelligent,
systems are efficient and interoperable, and an enterprise-wide data platform
supports real-time insights, enabling finance to be a strategic and trusted
advisor to the business.
Fynapse, the Group's intelligent finance data management and accounting
platform delivers on Autonomous Finance, with a cloud native, highly
performant and modular solution that not only serves operational and
regulatory accounting requirements, but also delivers a granular data fabric
upon the extendable Fynapse data cloud. Fynapse provides the rich foundation
for AI tooling, enabling Aptitude's clients to realise the efficiencies that
may be achieved from emerging AI technologies and the Autonomous Finance
function.
The Fynapse platform enables the expansion of the go-to-market opportunity for
Aptitude moving from compliance and regulations to finance transformation and
enabling organisations to create a truly autonomous finance function. It also
provides organisations and strategic partners with a differentiated
alternative to the ERP vendors through its market leading support of AI for
finance, rapid implementation timelines, high volume processing and
cutting-edge technology that supports real-time streaming.
Along with the overall Fynapse platform, the Group has initially developed the
accounting rules and subledger engines which build upon the successful AAH
product and its' significant pedigree to centralise, automate and manage
operational, management and regulatory accounting and posting into an
extendable enterprise subledger.
Fynapse has a low total cost of ownership, with rapid implementation cycles,
which make the platform commercially attractive to a wide range of
organisations varying in size and sector.
The Group continues strategic investment in Fynapse, with an increasing
proportion of overall research and development spend directed toward the
platform. The overall cost of our investment in Fynapse increased in 2023 to
£6.1 million (2022: £4.9 million) all of which is expensed. The platform
nature of Fynapse provides options for the Group in the mid-term, either
through the development of new engines with additional functionality, or
through strategic acquisitions of supporting functionality.
The Group's strategic focus is the successful execution against the Fynapse
opportunity through partnerships, direct sales, and conversions from the
existing client base.
The Group signed a strategic partnership with Microsoft in December 2022 to
deeply integrate the Fynapse platform with Microsoft Dynamics 365 and operate
on the Microsoft Azure cloud platform, which has been completed in 2023. The
partnership allows both Aptitude and Microsoft to present a combined
end-to-end solution to prospects, increasing competitiveness against vendors
providing single stack functionality, as well as strengthening Microsoft's
competitive position. The Group's vision for AI Autonomous Finance is
complementary with Microsoft's investments in AI across its offerings and will
further benefit the Fynapse platform and Aptitude's clients.
The Group's charter client was an existing AAH user, and a significant
opportunity exists in migrating the Group's current AAH clients to Fynapse,
presenting both an upsell opportunity as well as a retention tool. Fynapse
will also allow a simplified cross-sell opportunity as additional engine
functionality is developed on the platform.
The first new logo direct sale of Fynapse was achieved in 2023 with the sale
achieved in a new market for Aptitude, demonstrating the breadth of the
opportunity with the platform. The Group looks ahead to 2024 with growing
pipeline momentum and an increasingly referenceable offering to prospects.
AAH is the Group's established product which centralises and automates
finance, accounting and reporting processes, creating a deep level of
operational intelligence for our clients. It also delivers a consolidated, yet
highly granular, single view of financial data which enhances business
insights to assist decision making.
Subscription Management
eSuite, Aptitude's subscription management tool, is a modular, cloud based
end-to-end SaaS solution for large, international, enterprise customers. The
application is targeted towards the subscription economy and provides identity
management, CRM, automated billing, payment processing, and churn management
capabilities, enabling businesses to acquire, monetise and optimise customers
subscriptions.
While macroeconomic conditions have had a short-term effect on the
predominantly media and publishing dominated eSuite client base, the Group is
confident in the mid-term growth opportunity for eSuite. As a result,
investment levels in eSuite have been maintained to further strengthen
functionality, minimise churn and position the product well as macroeconomic
conditions improve. The Group will take a targeted go-to-market approach,
prioritising the key media and publishing sectors in line with eSuite's
strengths.
Compliance Suite
The compliance suite includes the Aptitude Insurance Calculation Engine
("AICE"), Aptitude RevStream ("AREV"), the Aptitude Revenue Recognition Engine
("ARRE"), the Aptitude Lease Accounting Engine ("ALAE"), Aptitude Calculate
("AC") and the Aptitude Platform ("APT").
The Group has achieved significant historical success with its suite of
compliance products. The products have generated a sizeable amount of Annual
Recurring Revenue and demonstrated Aptitude's strength and credibility in
serving the office of the CFO. Aptitude's target for the compliance suite is
in maintaining client satisfaction, minimising client churn and cross-selling
Fynapse. The Group will take an opportunistic go-to-market approach and
establish investment at appropriate levels to underpin client satisfaction.
Assure and Implementation Services
Aptitude Assure is a solution management services offering resourced from
Aptitude's innovation centre in Poland. This service extends the
responsibilities of Aptitude beyond traditional software maintenance services
to include those that have typically been performed by the clients' own teams.
Beyond extended solution support, Assure includes release management,
processing support, client enablement, and solution optimisation through the
monitoring of system performance, solution health checks, and office hours for
expert advisory. Clients with Assure allow the Group to support client
adoption of new product features as offerings evolve and will be of particular
importance to Fynapse clients as the product further evolves in future. Assure
services are higher margin than traditional implementation services,
recurring, and are provided at a lower cost of ownership for the Group's
clients.
Aptitude also provides implementation services to its clients, with the scale
of such services depending on the nature of the application, the size of the
opportunity and the balance of responsibilities between Aptitude and its
partners. The Group's services are provided by a significant pool of highly
skilled individuals, providing deep domain, technical and functional expertise
which is highly valued by our clients and provide a differentiator compared to
our competitors.
The business continues to expand the enablement of its partner network to
facilitate their ability to implement Aptitude's product suite reliably and
efficiently. While it is expected that this enablement will lead to a greater
proportion of services being provided by partners, it will also increase the
velocity of software through those partnerships. The Group is committed to
retaining a high-quality delivery capability in line with client demand to
support its clients and partners.
Growth and Client Success
The foundation of Aptitude's strategy for growth is the Fynapse platform.
Fynapse presents by far the largest addressable market for all of the Group's
products, and as such the Group is restructuring and refocusing its
go-to-market and product investment in delivering on this opportunity.
The Group has recently appointed a Chief Revenue Officer to drive a consistent
global approach to growth, including expanding Aptitude's successful approach
with partners in the US out to other regions. The Group has also adopted a
focused go-to-market approach centred on a select number of regions, sectors,
and partners in line with the opportunity in those areas.
Also fundamental to Aptitude's growth is the retention of our client base.
Gross ARR churn for 2023 was 10% (2022: 7%), with the higher than usual rate
affected by the macroeconomic environment, which impacted the Group's
predominantly Technology, Media and Telecoms client base in eSuite, AREV and
ARRE disproportionately. Mitigation of the gross churn rate is a critical
priority in 2024, and the Group has implemented several initiatives, including
the acceleration of investment in key product functionality and the
enhancement of a data led client health process to assist in churn that has
continued.
The Group has also appointed a Chief Client Experience Officer, with ownership
of all key touchpoints for a client during their life with Aptitude. The
appointment of this end-to-end and globalised role increases organisational
visibility and speed in addressing client needs and concerns.
People and Locations
Aptitude has office locations across the UK, US, Poland, Singapore, Australia
and Canada, and the Group's two technology centres are based in Poland and the
north-west of England. The Group's presence in Poland continues to generate
cost advantages for Aptitude. The Group has recently appointed a Chief Product
and Technology Officer to provide end-to-end accountability for the design and
build of Aptitude's products and enhance collaboration across the Product and
Technology teams based across multiple regions.
Aptitude targets a high-performance culture, where individuals can achieve
their potential in support of the Group's objectives. Supported by a newly
refocused People and Culture team, the Group regularly assesses employees on a
performance and potential basis, with an aim to invest in and develop key
talent. Through this assessment, the Group is able to retain and develop key
talent in support of succession planning, actively manage lower performers to
a better outcome and increase efficiency.
Overall headcount decreased 10% to 472 (31 December 2022: 527). The reduction
in headcount is a result of cost reduction action taken in 2023 as a result of
the final elements of the eSuite integration and organisational restructuring
in support of the refocused strategy. The new structure is flatter, with a
reduced management layer, and more efficient. Of the total headcount, 281
(2022: 296) are based at the innovation centres and working on the design,
implementation, and support of the Group's products. The Group continues to
monitor headcount closely, with future roles hired in line with revenue
opportunity.
Aptitude takes diversity and inclusion very seriously, especially in relation
to reward. The Group intends to implement structural processes to ensure
fairness in approach to promotions and compensation in 2024. Additionally, the
Group is continuing the Women in Leadership initiative to help attract a
diverse range of talent to its leadership roles.
Capital Allocation Policy
Aptitude aims to deliver high returns to shareholders through targeting
sustainable profit growth and strong free cash flow. The Group invests in
developing its business driven by the opportunity with Fynapse, while
maintaining robust liquidity to manage the working capital cycle. Aptitude's
capital allocation priorities are as follows
· Managing working capital - The first priority of the Group is to maintain
sufficient cash reserves to manage the annual working capital cycle, while
maintaining appropriate levels of net funds. A level of net cash not less than
1.5 x adjusted EBITDA is the Group's stated minimum.
· Investment for organic growth - The Group continues to invest in the organic
growth of the business including the need to continue to invest in our people
and technology and through capital expenditure where required.
· Maintenance of the Group's progressive dividend - The Group is committed to
provide progressive dividends to shareholders, and this remains the preferred
ongoing method to return cash to shareholders without impacting on the
investment required to grow the business
· Enhanced returns to shareholders - As the Group continues to generate excess
cash after the above priorities, the Group will look to make enhanced returns
to shareholders
As announced separately today, Aptitude has commenced an on-market share
buyback programme of up to £20m over three years in line with the newly
adopted capital allocation policy. The buyback programme is in accordance with
the Group's authority to make market purchases of its own Ordinary Shares
granted to it by shareholders on 17 May 2023.
While the above framework is intended to guide decision making for the
allocation of capital, the Board may choose to exercise discretion in its
application should there be a business requirement.
With the focused strategy, organisational realignment activities combined with
a new leadership team, I am confident that Aptitude will capitalise on the
significant AI Autonomous Finance market opportunity, that is sponsored by our
strategic partners.
This will result in a stronger underlying business and higher quality revenues
for the Group through Fynapse.
Alex Curran
Chief Executive
Officer
20 March 2024
Group Financial Performance
Revenue
Recurring Revenues
Annual Recurring Revenue ('ARR') grew by 2% on a constant currency basis in
the year to £51.1 million at 31 December 2023 (31 December 2022: £50.2
million, restated for the prevailing exchange rate at 31 December 2023).
ARR is the key financial metric for the Group. Included within ARR are
Aptitude's annual licence fees and maintenance for its on-premise clients,
subscription fees for the Group's SaaS clients and revenues from its Solution
Management Service offering ('Aptitude Assure'), this offering contributed ARR
at 31 December 2023 of £5.0 million (31 December 2022: £4.3 million).
Net Retention Rate in the year was 98% (2022: 102%), measured by the total
value of on-going ARR at the year-end from clients in place at the start of
the year as a percentage of the opening ARR from those clients on a constant
currency basis. The Group benefitted from standard inflationary clauses within
the majority of its contracts, however, continuing churn, predominantly in
Subscription, Billing and Revenue Management, reduced the benefit of these
increases.
Recurring revenues recognised in 2023 increased by 6% to £53.4 million (2022:
£50.5 million), representing growth of 6%. Recurring revenues are a strategic
priority for the Group and now represent 71% of overall revenue (2022: 68%). A
key part of the Group's strategy is to increase this percentage whilst
maximising the growth rate of Aptitude's ARR, increasing both the overall
quality of revenue and operating margin.
Non-Recurring Revenue
Non-recurring revenue, comprised of implementation services, software
development and non-recurring software fees which totalled £21.3 million for
the year ended 31 December 2023 (2022: £23.9 million) representing an 11%
reduction. The reduction in non-recurring revenues is in line with the Group's
expectation as it works more closely with its partners in this area.
Research & Development Expenditure
Total expenditure on product management, research & development increased
5% in the year ended 31 December 2023 to £17.8 million (2022: £17.0
million). Research & development costs represent 24% of revenue for the
year ended 31 December 2023 (2022: 23%). The Group will carefully monitor
research & development spend and ensure that investment is only made in
line with the revenue opportunity.
The Board has continued to prudently determine that none of the internal
research & development costs incurred during the year meet the criteria
for capitalisation. Consequently, these have been expensed as incurred through
the income statement.
Operating Profit and Margins
Adjusted Operating Profit for the year ended 31 December 2023 was in line with
expectations at £9.7 million (2022: £7.5 million). Adjusted Operating Margin
increased to 13% (2022: 10%) following the completion of the integration of
the MPP Global acquisition and other cost action taken in the year. Operating
profit on a statutory basis was £5.3 million (2022: £3.7 million).
In addition to the cost action outlined above, the Group's evolving revenue
mix towards higher recurring revenue generated an incremental margin benefit.
The continued success of Fynapse, with its cloud-native capabilities, is
expected to further enhance margins.
Foreign Exchange
With 50% (2022: 42%) of the Group's revenues being generated from North
American clients, the majority of which are invoiced in US Dollars, the
financial results are impacted by changes in the US dollar exchange rate.
Aptitude's 2022 revenue and Adjusted Operating Profit would have been reported
at £74.2 million and £7.7 million respectively on a constant currency basis
(compared to actual result of £74.4 million and £7.5 million). Constant
currency is calculated by comparing the 2023 results with 2022 results
retranslated at the rates of exchange prevailing during 2023.
Non-Underlying Items
Non-underlying items of £4.4 million (2022: £3.8 million) are principally
related to the £0.8 million (2022: £0.4 million) of final integration costs
incurred on the MPP Global acquisition, £0.2m of restructuring costs and
intangible amortisation of £3.4 million (2022: £3.4 million).
Taxation
The total tax charge before adjusting for the impact of non-underlying and
other sundry items of £1.8 million (2022: £1.5 million) represents 18.83% of
the Group's profit before tax (2022: 21.08%).
Statutory Results
The Group reported a profit for the year attributable to equity shareholders
of £4.1 million (2022: £2.6 million).
Earnings per Share
Adjusted Basic Earnings per Share increased by 37% to 13.6 pence (2022: 9.9
pence) and Basic Earnings per Share increased 60% to 7.2 pence (2022: 4.5
pence).
Dividend
A final ordinary dividend of 3.60 pence per share is proposed (2022: 3.60
pence), making a total ordinary dividend of 5.40 pence per share for the year
(2022: 5.40 pence).
Balance Sheet
The Group continues to have a strong balance sheet with net assets at 31
December 2023 of £60.3 million (2022: £60.5 million). Cash at 31 December
2023 was £34.1 million (31 December 2022: £29.2 million) and net funds of
£22.7 million (31 December 2022: £15.9 million). Trade receivables (net) at
31 December 2023 increased to £10.3 million (2022: £9.7 million) of which
£5.0 million (2022: £4.1 million) were overdue for payment at the year end.
Of these overdue balances £3.6 million has been collected at 18 March 2024.
DSO (debtor days) increased to 53 at 31 December 2023 (2022: 44). The growth
in the Group's Annual Recurring Revenue resulted in deferred income at 31
December 2023 increasing to £31.5 million (2022: £29.6 million).
Mike Johns
Chief Financial Officer
20 March 2024
Group Income Statement
for the year ended 31 December 2023
Year ended 31 Dec 2023 Year ended 31 Dec 2022
Note Before non-underlying items Non- underlying items Total Before non-underlying items Non- underlying items Total
Continuing operations £000 £000 £000 £000 £000 £000
Revenue 1 74,685 - 74,685 74,394 - 74,394
Operating costs 2 (64,959) (4,441) (69,400) (66,887) (3,822) (70,709)
Operating profit 9,726 (4,441) 5,285 7,507 (3,822) 3,685
Finance income 282 - 282 18 - 18
Finance costs (527) - (527) (498) - (498)
Net finance costs (245) - (245) (480) - (480)
Profit before income tax 9,481 (4,441) 5,040 7,027 (3,822) 3,205
Income tax expense 3 (1,786) 871 (915) (1,481) 871 (610)
Profit for the period 7,695 (3,570) 4,125 5,546 (2,951) 2,595
Earnings per share
Basic 4 7.2p 4.5p
Diluted 4 7.1p 4.5p
group statement of comprehensive income
for the year ended 31 December 2023
Year ended 31 Dec 2023 Year ended 31 Dec 2022
£000 £000
Profit for the year 4,125 2,595
Other comprehensive income/(expense)
Items that will or may be reclassified to profit or loss:
Cash flow hedges reclassified to income statement (1,242) 187
Gain on effective cash flow hedges 1,044 1,445
Currency translation difference (954) 1,972
Deferred tax on cash flow hedges 50 (335)
Other comprehensive (expense)/income for the year, net of tax (1,102) 3,269
Total comprehensive income for the year 3,023 5,864
Group Balance Sheet
for the year ended 31 December 2023
As at As at
31 Dec 2023 31 Dec 2022
Notes £000 £000
ASSETS
Non-current assets
Property, plant and equipment including right-of-use assets 6 4,484 5,103
Goodwill 7 46,006 46,006
Intangible assets 8 17,739 21,120
Other long-term assets 1,016 1,307
Deferred tax assets 1,379 423
70,624 73,959
Current assets
Trade and other receivables 9 12,526 12,297
Financial assets - derivative financial instruments 1,141 1,339
Current income tax assets 1,037 1,352
Cash and cash equivalents 34,085 29,245
48,789 44,233
Total assets 119,413 118,192
LIABILITIES
Current liabilities
Financial liabilities
- borrowings 10 (1,250) (1,250)
Trade and other payables 11 (40,773) (38,146)
Capital lease obligations 12 (426) (553)
Current income tax liabilities (1,588) (119)
Provisions 13 (100) (114)
(44,137) (40,182)
Net current assets 4,652 4,051
Non-current liabilities
Financial liabilities - borrowings 10 (7,139) (8,347)
Capital lease obligations 12 (2,588) (3,196)
Provisions 13 (268) (202)
Deferred tax liabilities (4,967) (5,724)
(14,962) (17,469)
NET ASSETS 60,314 60,541
Group Balance Sheet
for the year ended 31 December 2023
As at As at
31 Dec 2023 31 Dec 2022
£000 £000
SHAREHOLDERS' EQUITY
Share capital 14 4,204 4,204
Share premium account 11,959 11,959
Capital redemption reserve 12,372 12,372
Other reserves 34,989 35,199
Accumulated losses (2,349) (3,286)
Foreign currency translation reserve (861) 93
TOTAL EQUITY 60,314 60,541
Group Statement of changes in shareholders' equity
for the year ended 31 December 2023
Attributable to owners of the Parent
Share capital Share premium Accumulated losses Foreign currency translation reserve Capital
redemption Other Total
reserve reserves equity
£000 £000 £000 £000 £000 £000 £000
Group
Balance at 1 January 2023 4,204 11,959 (3,286) 93 12,372 35,199 60,541
Profit for the year - - 4,125 - - - 4,125
Cash flow hedges reclassified to income statement - - - - - (1,242) (1,242)
Gain on effective cash flow hedges - - - - - 1,044 1,044
Deferred tax on cash flow hedges - - - - - 50 50
Exchange rate adjustments - - - (954) - - (954)
Total comprehensive income for the year - - 4,125 (954) - (148) 3,023
Share options - value of employee service - - 125 - - - 125
Transfer on exercise of options - - (151) - 124 (27)
Purchase of own shares - - - - - (186) (186)
Deferred tax on share options - - (66) - - - (66)
Dividends to equity holders of the company - - (3,096) - - - (3,096)
Total Contributions by and distributions to owners of the company recognised - - (3,188) - - (62) (3,250)
directly in equity
Balance at 31 December 2023 4,204 11,959 (2,349) (861) 12,372 34,989 60,314
Group Cash Flow Statement
for the year ended 31 December 2023
Year ended Year ended
31 Dec 2023 31 Dec 2022
Note £000 £000
Cash flows from operating activities
Cash generated from operations 15 11,945 5,272
Interest paid (316) (498)
Income tax paid (635) (1,597)
Net cash flows generated from operating activities 10,994 3,177
Cash flows from investing activities
Purchase of property, plant and equipment, excluding right-of-use assets (601) (831)
Interest received 282 18
Net cash (used in) investing activities (319) (813)
Cash flows from financing activities
Net proceeds from issuance of ordinary shares - 23
Dividends paid to company's shareholders 5 (3,096) (3,093)
Purchase of own shares (186) -
Repayments of loan (1,250) (313)
Extension fee on loan (40) -
Repayment of capital lease obligations (534) (405)
Net cash generated (used in) from financing activities (5,106) (3,788)
Net increase/(decrease) in cash and cash equivalents 5,569 (1,424)
Cash, cash equivalents and bank overdrafts at beginning of year 29,245 29,064
Exchange rate (losses)/gains on cash and cash equivalents (729) 1,605
Cash and cash equivalents at end of year 34,085 29,245
Notes to the Audited preliminary results for the year ended 31 December 2023
1. Segmental analysis
Business segments
The Board has determined the operating segments based on the reports it
receives from management to make strategic decisions.
The only business segment for both periods was Aptitude and therefore no
segmental analysis is provided for this period.
The principal activity of the Group throughout 2022 and 2023 was the provision
of business-critical software and services.
1 (a) Geographical analysis
The Group has two geographical segments for reporting purposes, the United
Kingdom and the Rest of the World.
The following table provides an analysis of the Group's sales by origin and by
destination.
Sales revenue by origin Sales revenue by destination
Year ended Year ended Year ended Year ended
31 Dec 2023 31 Dec 2022 31 Dec 2023 31 Dec 2022
£000 £000 £000 £000
United Kingdom 41,087 39,329 11,747 15,809
Rest of World 33,598 35,065 62,938 58,585
74,685 74,394 74,685 74,394
2. Non-underlying items
31 Dec 2023 31 Dec 2022
£000 £000
Amortisation of intangibles 3,381 3,382
Acquisition and associated reorganisation costs 1,060 440
4,441 3,822
3. Income tax expense
Year ended Year ended
31 Dec 2023 31 Dec 2022
Analysis of charge in the year £000 £000
Current tax:
- tax charge on underlying items (2,463) (1,051)
- adjustment to tax in respect of prior periods on underlying items (241) (344)
Total current tax (2,704) (1,395)
Deferred tax:
- tax credit/(charge) on underlying items 951 (111)
- tax credit on non-underlying items 871 871
- adjustment to tax in respect of prior periods on underlying items (33) 25
Total deferred tax 1,789 785
Income tax expense (915) (610)
The net adjustment to tax in respect of prior periods on underlying items
totalling £274,000 (2022: £319,000) relates to the reduction in the assumed
benefit from research and development relief in the UK.
The total tax charge of £915,000 (2022: £610,000) represents 18.2% (2022:
19.0%) of the Group profit before tax of £5,040,000 (2022: £3,205,000).
After adjusting for the impact of non-underlying items, change in tax rates,
share based payment charge and prior year tax charge, the tax charge for the
year of £1,702,000 (2022: £1,375,000) represents 17.95% (2022: 19.57%),
which is the tax rate used for calculating the adjusted earnings per share.
The difference between the total tax charge and the amount calculated by
applying the effective United Kingdom corporation tax rate of 23.50% (2022:
19.00%) to the profit on ordinary activities before tax is as follows:
Year ended Year ended
31 Dec 2023 31 Dec 2022
£000 £000
Profit before tax 5,040 3,205
Tax at the United Kingdom corporation tax rate of 23.50% (2022: 19.00%) (1,185) (610)
Effects of:
Adjustment to tax in respect of prior periods (274) (319)
Adjustment in respect of foreign tax rates 62 (138)
Non-underlying expenses not deductible for tax purposes (138) (45)
Other 166 (303)
Research and development tax relief 226 561
Recognition of tax losses not recognised as a deferred tax asset 190 214
Change in future tax rates 38 30
Total taxation (915) (610)
United Kingdom corporation tax is calculated at 23.50% (2022: 19.00%) of the
estimated assessable profit for the year. Taxation for other jurisdictions is
calculated at the rates prevailing in the respective jurisdictions.
4. Earnings per share
To provide an indication of the underlying operating performance per share,
the adjusted profit after tax figure shown below excludes non-underlying items
and has a tax charge using the effective rate of 17.95% (2022: 19.57%).
Year ended Year ended
31 Dec 2023 31 Dec 2022
£000 £000
Profit before tax and non-underlying items 9,481 7,027
Tax charge at a rate of 17.95% (2022: 19.57%) (1,702) (1,375)
7,779 5,652
Prior years' tax charge (274) (320)
Non-underlying items net of tax (3,570) (2,951)
Recognition of tax losses not recognised as a deferred tax asset 190 214
Profit on ordinary activities after tax 4,125 2,595
2023 2022
Number Number
(thousands) (thousands)
Weighted average number of shares 57,338 57,288
Effect of dilutive share options 670 819
58,008 58,107
2023 2023 2022 2022
Basic EPS pence Diluted EPS pence Basic EPS pence Diluted EPS pence
Earnings per share 7.2 7.1 4.5 4.5
Non-underlying items net of tax 6.2 6.2 5.2 5.1
Prior years' tax charge 0.5 0.5 0.6 0.6
Recognition of tax losses (0.3) (0.3) (0.4) (0.4)
Adjusted earnings per share 13.6 13.5 9.9 9.8
Adjusted earnings per share are calculated using adjusted profit after tax.
5. Dividends
2023 pence per share 2022 pence per share 2023 2022
£000 £000
Dividends paid:
Interim dividend 1.80 1.80 1,032 1,032
Final dividend (prior year) 3.60 3.60 2,064 2,061
5.40 5.40 3,096 3,093
Proposed but not recognised as a liability:
Final dividend (current year) 3.60 3.60 2,064 2,064
The proposed final dividend was approved by the Board on 20 March 2024 but was
not included as a liability as at 31 December 2023, in accordance with IAS 10
'Events after the Balance Sheet date'. If approved by the shareholders at the
Annual General Meeting this final dividend will be payable on 14 June 2024 to
shareholders on the register at the close of business on 24 May 2024.
6. Property, plant and equipment including right-of-use assets
31 Dec 2023 31 Dec 2022
£000 £000
Opening net book value 1 January 5,103 4,261
Additions 601 1,660
Net disposals (117) (8)
Exchange movements (54) 322
Depreciation (1,049) (1,132)
4,484 5,103
7. Goodwill
31 Dec 2023 31 Dec 2022
£000 £000
Opening net book value 1 January 46,006 46,006
46,006 46,006
8. Intangible assets
31 Dec 2023 31 Dec 2022
£000 £000
Opening net book value 1 January 21,120 24,502
Amortisation (3,381) (3,382)
17,739 21,120
9. Trade and other receivables
31 Dec 2023 31 Dec 2022
£000 £000
Trade receivables 10,678 10,091
Less: provision for impairment of receivables (358) (421)
Trade receivables - net 10,320 9,670
Other receivables 14 -
Prepayments 1,796 1,513
Accrued income 396 1,114
12,526 12,297
Within the trade receivables balance of £10,678,000 (2022: £10,091,000)
there are balances totalling £5,036,000 (2022: £4,057,000) which, at 31
December 2023, were overdue for payment. Of this balance £3,612,000 (2022:
£2,841,000) has been collected at 18 March 2024 (2022: 17 March 2023).
10. Financial liabilities
31 Dec 2023 31 Dec 2022
£000 £000
Bank loan 8,389 9,597
The borrowings are repayable as follows:
Within one year 1,250 1,250
In the second year 7,188 8,438
8,438 9,688
Unamortised prepaid facility arrangement fees (49) (91)
At 31 December 8,389 9,597
On 15 October 2021, the Group and Company entered into a loan agreement with
Bank of Ireland consisting of a £10 million term loan in addition to a
revolving credit facility of £10 million. The loan is secured on all the
assets of the Group. Operating covenants are limited to the Group's net debt
leverage of 2.0 : 1 and interest cover of 4.0 : 1. At 31 December 2023, the
Group's net debt leverage was -3.7 : 1 and interest cover was 16.5 : 1. The
term loan is repayable over three years with an initial 12-month repayment
holiday followed by annual capital repayments of £1,250,000. The term loan
contains two one-year extension options, one of which was exercised during the
year. The Group's current intention is to exercise the second extension option
in the next year. At the end of the term, a bullet payment for the remaining
balance of the loan is due. The loan is denominated in Pound Sterling and
carries interest at SONIA plus 1.75%. The Group entered into an interest swap
on 2 November 2021, effectively fixing the interest rate at 2.95% over the
term of the loan.
11. Trade and other payables
31 Dec 2023 31 Dec 2022
£000 £000
Trade payables 482 826
Other tax and social security payable 1,614 1,370
Other payables 168 204
Accruals 7,034 6,183
Deferred income 31,475 29,563
40,773 38,146
31 Dec 2023 31 Dec 2022
£000 £000
Amounts payable under capital lease agreements:
Within one year 538 642
Within two to five years 1,997 2,284
After five years 906 1,387
Total 3,441 4,313
Less: future finance charges (427) (564)
Present value of lease obligations 3,014 3,749
Less: Amount due for settlement within 12 months (shown under current (426) (553)
liabilities)
2,588 3,196
12. Capital lease obligations
31 Dec 2023 31 Dec 2022
£000 £000
The present value of financial lease liabilities is split as follows:
Within one year 426 553
Within two to five years 1,728 1,897
After five years 860 1,299
3,014 3,749
13. Provisions for other liabilities and charges
Provisions
31 Dec 2023 31 Dec 2022
£000 £000
At 1 January 316 379
Charged/(released) to income statement 158 (76)
Utilised in period (114) -
Foreign exchange movement 8 13
At 31 December 368 316
£288,000 (2022: £273,000) of the total provision at 31 December 2023 of
£368,000 (2022: £316,000) relates to the cost of dilapidations in respect of
its occupied leasehold premises.
14. Share capital
Ordinary shares of 7 1/3p each Number £000
Issued and fully paid:
At 1 January 2023 57,337,611 4,204
At 31 December 2023 57,337,611 4,204
15. Cash flows from operating activities
Reconciliation of profit before tax to net cash generated from operations:
Year ended Year ended
31 Dec 2023 31 Dec 2022
£000 £000
Profit before tax for the year 5,040 3,205
Adjustments for:
Depreciation 1,049 1,132
Amortisation 3,381 3,382
Share-based payment expense 125 695
Finance income (282) (18)
Finance costs 527 498
Changes in working capital excluding the effects of acquisition:
Decrease/(increase) in receivables 63 (1,485)
Increase/(decrease) in payables 2,042 (2,137)
Cash generated from operations 11,945 5,272
16. Contingent liabilities
The Group had no contingent liabilities at 31 December 2023. In 2022, two
clients have ceased the implementation of the Group's products and provided
the Group with correspondence terminating their multi-year agreement alleging
contractual breaches by Aptitude and claiming damages. The Group rejected
both the purported termination of the two agreements and claim for damages and
has notified the clients of the charges due to Aptitude under the minimum
terms of their agreements. One was resolved in the year and the Group maintain
their position on the other, therefore no provision has been recognised at 31
December 2023 (2022: £nil).
The Group does not consider a contingent liability in respect of either of the
claims at 31 December 2023.
17. Statement by the directors
The preliminary results for the year ended 31 December 2023 are prepared in
accordance with UK adopted International Accounting Standards (IAS) and
interpretations by the IFRS Interpretations Committee applicable to companies
reporting under UK adopted IFRS. They do not include all the information
required for full annual statements and should be read in conjunction with the
2023 Annual Report. The accounting policies adopted in this preliminary
announcement are consistent with the Annual Report for the year ended 31
December 2023.
The comparative figures for the financial year 31 December 2022 have been
extracted from the Group's statutory accounts for that financial year. The
2022 financial statements, which were prepared in accordance with UK adopted
international accounting standards and company law, have been reported on by
the Group's auditors and delivered to the registrar of companies.
The financial information set out in this preliminary announcement does not
constitute the Company's statutory accounts for the years ended 31 December
2023 or 31 December 2022. The Annual Report for 2023 will be delivered to the
Registrar of Companies in due course. The auditors' report on those accounts
was unqualified and neither drew attention to any matters by way of emphasis
nor contained a statement under either section 498(2) of Companies Act 2006
(accounting records or returns inadequate or accounts not agreeing with
records and returns), or section 498(3) of Companies Act 2006 (failure to
obtain necessary information and explanations).
The Board of Aptitude Software Group plc approved the release of this audited
preliminary announcement on 20 March 2024.
The Annual Report for the year ended 31 December 2023 will be posted to
shareholders in due course and will be delivered to the Registrar of Companies
following the Annual General Meeting of the Company. The report will also be
available on the investor relations page of our web site
(www.aptitudesoftware.com). Further copies will be available on request and
free of charge from the Company Secretary at 8th Floor, 138 Cheapside, London,
EC2V 6BJ.
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