REG - dotDigital Group plc - Trading Update

dotDigitalAnnouncement

27/07/2023 07:15

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RNS Number : 3293H  dotDigital Group plc  27 July 2023

Dotdigital Group plc

("Dotdigital" or the "Group")

FY23 Trading Update

Double-digit growth and strong cash generation

Dotdigital Group plc (AIM: DOTD), the leading 'SaaS' provider of an
omnichannel marketing automation and customer engagement platform, is pleased
to provide the following trading update for the year ended 30 June 2023
(FY23). The trading performance in this statement is based on unaudited
management accounts.

Highlights

 ·         Robust trading across all regions expected to deliver 10% growth in revenue
           to £69.1m (2022: £62.8m), slightly ahead of consensus market
           expectations(1)
 ·         Continued progress against strategic pillars:
           o  Recurring and repeating revenue as a percentage of total revenue
           maintained at 94% (2022: 94%)
           o  Return to growth in the US region following stabilisation and investment
           o  ARPC(2) continued its upward trend, growing by 11% to
           approximately £1,622 per month (FY22:  £1,461 per month);
           o  Functionality recurring revenue (from license fees, data and enhanced
           bolt-on functionality) grew 11% to £24.9m (2022: £22.3m);

           o  Revenues from customers using a data connector from strategic partners up
           8% to £31.2m (2022: £28.9m)
 ·         Adjusted EBITDA, operating profit, and profit before tax(3) are all expected
           to be in line with market expectations(1);
 ·         Strong cash generation through the period with cash balance of £52.7m on 30
           June 2023, providing the flexibility to invest in the organic and acquisition
           growth strategy;
 ·         Intention to pay an increased final dividend in line with market
           expectations(4);

 

Overview

The Board is pleased to report double-digit revenue growth in FY23, driven by
healthy demand across the Group's diverse customer base and growth in all
regions.

As projected at our interim results in March 2023, investments made in the US
team has delivered a growing pipeline and acceleration of sales, resulting in
a return to growth in the region.

Alongside this, EMEA and APAC have performed well. We are particularly pleased
to see our investments in Japanese markets bear fruit, with a solid partner
network established and key appointments leading to numerous customer wins in
Q4.

Building out Dotdigital's Customer Experience and Data Platform (CXDP) has
been the key focus of our product and development team in the year. As
reported on 25 May 2023, we initiated a series of enhancements to our
platform, enabling the Group to harness artificial intelligence and machine
learning capabilities to improve campaign content and deliver actionable
insights to our customers. These enhancements have been well-received.
 

Outlook

The Group has closed FY23 strongly with positive trading momentum across all
regions. We are continuing to invest in our technology stack to further
increase the capabilities and scale of our CXDP platform. Alongside this, we
also continue to appraise prospective acquisition targets to complement our
organic growth.

While cautious of the uncertainty from the wider economic environment, our
business model has been built to perform in different market conditions,
giving us confidence in our ability to drive steady growth, in line with
market expectations.

 

Milan Patel, CEO of Dotdigital, commented:

"Performance in FY23 was robust, with trading momentum building through the
first half and accelerating in the second. The progress we are making can be
attributed to the strength and resilience of our business model, the strategic
investments we continue to make in the platform and the strengthening of our
teams across all regions.

"Wider market uncertainty has prompted a shift to retention marketing among
our customers. In this environment, Dotdigital's platform insights and
omnichannel engagement represent a key tool for organisations placing a
greater focus on customer engagement. The Group continues to develop CXDP
capabilities, with a view to capturing the growing demand for a greater depth
of analytics and personalised user experiences delivered by rich datasets,
artificial intelligence and machine learning.

"The outlook is positive, and we retain our confidence in scaling our platform
and delivering continued growth through FY24 and beyond."

 

Notes

1.Market Consensus for revenue for the year ended 30 June 2023 is £67.57m.
Market Consensus for adjusted EBITDA and adjusted profit before tax for the
year ended 30 June 2023 are £22.47m and £14.65m respectively.

2. ARPC means Average Revenue Per Customer (including new customers added in
period and existing customers) and is calculated based on average invoice
values in our period end bill run.

3. Adjusted EBITDA, operating profit and profit before tax are all adjusted
for acquisition costs and share-based payments.

4. Market consensus FY23 final dividend per share is £0.01.

For further information please contact:

 Dotdigital Group Plc                                    Tel: 020 3953 3072

Milan Patel, CEO

Alistair Gurney, CFO                                   investorrelations@dotdigital.com

 Alma PR (Financial PR)                                  Tel: 020 3405 0210

 Hilary Buchanan                                         dotdigital@almapr.co.uk

 David Ison

 Kieran Breheny

 Canaccord Genuity (Nominated Advisor and Joint Broker)  Tel: 020 7523 8000

Bobbie Hilliam, Corporate Finance

 Jonathan Barr, Sales

 finnCap (Joint Broker)                                  Tel: 020 7220 0500

Jonny Franklin Adams, Corporate Finance

 Alice Lane, ECM

 Singer Capital Markets (Joint Broker)                   Tel: 020 7496 3000

Shaun Dobson, Corporate Finance

 Alex Bond, Corporate Finance

 

About Dotdigital

Dotdigital Group plc (AIM: DOTD) is a leading provider of omnichannel
marketing automation technology to digital marketing professionals. Our
Customer Experience and Data Platform (CXDP) uses data-driven insights, AI and
machine learning-driven capabilities and a hyper-personalised customer
experience to help marketers elevate their campaigns across multiple channels.

Founded in 1999, Dotdigital is headquartered in London with offices in
Amsterdam, Croydon, Manchester, Cheltenham, New York, Melbourne, Sydney,
Singapore, Cape Town, and Warsaw. Dotdigital's technology is currently used by
4000+ customers in 150+ countries.

 

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