REG - Datalex PLC Datalex PLC - DLE - H1 2024 Interim Financial Report

DatalexAnnouncement

28/08/2024 08:45

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RNS Number : 8902B  Datalex PLC  28 August 2024

Datalex plc

Interim Results 2024

Dublin, Ireland - 28 August 2024: Datalex plc (the "Company" or the "Group")
(Euronext Growth Dublin: DLE), a market leader in airline e-commerce
solutions, today announces its results for the six months ended 30 June 2024
("H1 2024"). Datalex has also announced today that it is launching a capital
raise.

 

 

 Metric                         H1 2024       H1 2023       YoY Growth (US$’000)    YoY Growth

                                     (%)
                                (US$’000)     (US$’000)
 Revenue                        13,210        12,867        343                     3%
 Platform Revenue               7,212         6,342         870                     14%
 Services Revenue               5,453         6,137         (684)                   (11%)
 Consultancy Revenue            545           388           157                     40%
 Gross Profit ((1))             3,787         3,018         769                     25%
 Gross Profit Margin            28.7%         23.5%                                 22%
 Adjusted EBITDA((2))           (1,963)       (3,109)       1,146                   37%
 Loss after tax for the period  (6,062)       (6,158)       96                      2%

(1)  Gross Profit is defined as revenue minus cost of sales.

(2)  Adjusted EBITDA is defined as earnings from operations before (i)
interest income and interest expense, (ii) tax expense, (iii) depreciation and
amortisation expense, (iv) share-based payments cost and (v) exceptional items

 
Commenting on the results, Jonathan Rockett, CEO, said:

 

"Looking at the first half of 2024, I am pleased at the continued progress we
have made in building a solid foundation for future growth.

 

This growth centers on our offer and order management platform, that will help
bring customers on a journey away from legacy technology that has held back
innovation within the airline industry for decades. Our offer and order
management capabilities give airlines the technology needed to capitalise on
maximising the airline retail opportunity.

 

Our airline customers have a shared vision of providing their passengers with
a modern and seamless retailing experience and enabling them to do that is
central to our product and platform offering.

 

In H1, we have continued to invest in migrating some of our customers to this
new platform, activated further capability for easyJet, and commenced the
activation of our shopping and pricing capability for Air Macau, who will
go-live in Q3 of this year.

 

When I look at 2024 as a full year, the year on year revenue growth will be
held back by some non-recurring revenue from 2023. However, we expect to see
several positive steps that will start to come to fruition in the year but
will be more evident in 2025. We do expect 2024 will be another year of
platform growth and gross margin expansion which points to this positive
trajectory for the business."

 
Significant Developments

 

·    Continued progress in achieving strategic milestones that are
important for Datalex's future sustainable growth.

 

·    Activated additional capabilities for our new customers, with a
particular focus on capability that will enable our airline customers to
unlock value, increase their retailing revenues and give them the ability to
deliver a better retailing experience to their consumers. In H1, easyJet went
live with additional capability and Datalex commenced activating its shopping
and pricing capability for Air Macau, who will go-live in Q3 2024.

 

·    Further migration of existing customers to our latest product
platform, including Air China, Edelweiss and Aer Lingus. Air China went live
with Datalex's latest shopping & pricing engine in August 2024. These
migration projects will enable Datalex to deliver increased value to these
customers.

 

·      Focus on optimisation, and in particular, how Datalex can create
efficiency and build scale into its operating model. A reorganisation was
commenced at the end of H1, and while it is premature to measure and report on
the benefits, the Group is confident that the changes made will improve
Datalex's ability to deliver in a more efficient and scalable way going
forward.

 

Key Financial Highlights

 

·      Revenue in H1 2024 was $13.2 million, a 3% increase versus the
same period in 2023 (H1 2023: $12.9 million). Continued growth in platform
revenue was partially offset by a decline in services revenue due to prior
year customer terminations.

 

o  Platform revenue of $7.2 million increased by 14% year on year (H1 2023:
$6.3 million). The increase in platform revenue is attributable to the ongoing
activation of product capabilities with recently acquired customers. We expect
to see continued platform revenue growth through H2 2024 as we complete
further activations and benefit from the migration of customers to our licence
and transaction fee model.

 

o  Services revenue of $5.5 million decreased by 11% year on year (H1 2023:
$6.1 million). Whilst there was positive momentum with existing customers, the
year-on-year decline is due to revenue from Scandinavian Airlines and Virgin
Australia not recurring this year.

 

o  As noted in the FY23 Annual Report, contracts with Scandinavian Airlines
and Virgin Australia ended last year. These contracts represented $3.5 million
of total revenue that will not recur this year (H1 2023: $1.4 million, H2
2023: $2.1 million), and will continue to create a drag on year-on-year growth
in 2024.

 

·      Gross profit for the six-month period ending 30 June 2024 was
$3.8 million, an increase of 25% year on year (H1 2023: $3 million). Year on
year growth is primarily driven by gross margin expansion due to delivering
higher margin on services projects. Gross profit margin of 28.7% in H1 2024
grew by 5 percentage points year on year (H1 2023: 23.5%). Gross profit margin
will be a key metric for the business going forward as we continue to
transition customers to a transaction and licence fee model.

 

·      Operating expenses for the first half of 2024 amounted to $5.8
million, decreasing 6% year on year (H1 2023: $6.1 million), mainly due to a
positive FX benefit. Operating expenses consist of all operating costs
excluding cost of sales, depreciation and amortisation, finance costs,
exceptional items, and share-based payments.

 

·      Adjusted EBITDA loss amounted to $2.0 million in H1 2024,
compared to $3.1 million loss for the same period in H1 2023, an improvement
of 37% year on year. The reduction in the EBITDA loss year on year is
attributable to gross profit growth and positive FX gains.

 

·      The company recorded a loss after tax of $6.1 million in H1 2024,
a slight improvement on the loss of $6.2 million for the same period in H1
2023.

 
Financing Update

 

Today, the Group has separately announced that it intends to complete a
capital raise, by way of a Firm Placing and Placing and Open Offer, to raise
approximately €25 million (before expenses). Funds raised will be used to
repay the entire Tireragh Limited debt facility and support the Group's
near-term working capital requirements. This effort is supported by the
Group's largest shareholders, who have expressed their intention to
participate in the proposed capital raise.

 
H1 2024 Interim Report

 

Datalex's H1 2024 Interim Report for the six months ended 30 June 2024 is
available to view on www.datalex.com/investors and will shortly be available
for inspection at
http://www.rns-pdf.londonstockexchange.com/rns/8902B_1-2024-8-27.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/8902B_1-2024-8-27.pdf)

 
H1 2024 Results Presentation

 

Management will review the H1 2024 results on a conference call at 9:00 am
Dublin time today.

A copy of the presentation will be available on our website at
investors.datalex.com.

 

If you would like to dial into the presentation, please join directly via the
link provided below.

https://www.workcast.com/register?cpak=4065378045421875
 
Notes

The financial information in this announcement is not audited and does not
constitute statutory financial statements of Datalex plc.

 

IFRS 15 recognition rules specify that timing of revenue recognition may be
affected by factors outside our control, for example, including the credit
rating of our customers. This may impact on the timing of recognition of
forecast revenues and costs, as included in this guidance statement.

Adjusted EBITDA (Note 4) is defined as earnings from operations before (i)
interest income and interest expense, (ii) tax expense, (iii) depreciation and
amortisation expense, (iv) share-based payments cost and (v) exceptional items
(see Note 7).

 

This announcement contains certain forward-looking statements. Actual results
may differ materially from those projected or implied in such forward-looking
statements. Such forward-looking information involves risks and uncertainties
that could significantly affect expected results. Those forward-looking and
other statements speak only as at the date of this announcement. Datalex
undertakes no obligation to update any forward-looking statements. No
statement in this document is intended as a profit forecast or a profit
estimate and no statement in this document should be interpreted to mean that
earnings per share for the current or future financial years would necessarily
match or exceed the historical published earnings per share.

 

Statements contained in this announcement are based on the knowledge and
information available to the Board at the date it was prepared and therefore
facts stated, and views expressed may change after that date. Nothing in this
announcement is intended to constitute an invitation or inducement to engage
in investment activity. This announcement does not constitute or form part of
any offer for sale or subscription of, or any solicitation of any offer to
purchase or subscribe for, any securities nor shall it or any part of it nor
the fact of its distribution form the basis of, or be relied on in connection
with, any contract, commitment or investment decision in relation thereto.
This announcement does not constitute a recommendation regarding any
securities.

 
Contact information
 
Investor Enquiries

Neil McLoughlin, Datalex plc

+353 1 806 3500

neil.mcloughlin@datalex.com (mailto:neil.mcloughlin@datalex.com)

 
Media Enquiries

Eavan Gannon, Sodali & Co.

+353 87 236 5973

Datalex@sodali.com (mailto:Datalex@powerscourt-group.com)

 

 

About Datalex

 

Datalex's purpose is to transform airline retail. Datalex is a market leader
in airline retail technology, offering unique products that enable airlines to
drive revenue and profit as digital retailers. Datalex has a strong track
record of delivering digital retail transformation for progressive airline
brands worldwide. The Group is headquartered in Dublin, Ireland, and maintains
offices across Europe, the USA and China. In 2023, Datalex was awarded the
'Great Place to Work(®)' and 'Best Workplaces in Tech™' certifications.
Datalex plc is a publicly listed company, on Euronext Growth, Dublin.

Learn more at www.datalex.com (https://www.datalex.com/)

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