REG - Eagle Eye Solutions - Final Results
18/09/2024 07:00
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RNS Number : 5964E Eagle Eye Solutions Group PLC 18 September 2024
18 September 2024
Eagle Eye Solutions Group plc
("Eagle Eye", the "Group", or the "Company")
Final results for the year ended 30 June 2024
Strong growth in ARR and EBITDA, exiting the year with increasing win momentum
Eagle Eye, (LSE: "EYE"), a leading SaaS technology company that creates
digital connections enabling personalised, real-time marketing, is pleased to
announce its audited results for the financial year ended 30 June 2024 (the
"Year").
Financial Highlights
FY24 FY23 % change
Group Revenue £47.7m £43.1m +11%
Recurring revenue (subscription fees and transactions) 79% 80% -1ppt
Period end Annual Recurring Revenue(1) (ARR) £39.7m £33.3m +19%
Net Revenue Retention(2) 109% 137% -28ppt
Adjusted EBITDA(3) £11.3m £8.8m +28%
Adjusted EBITDA margin 24% 20% +4ppt
Profit after tax £5.7m £1.2m +383%
Closing net cash(4) position £10.4m £9.3m +12%
( )
(1)Period End Annual Recurring Revenue is defined as period exit rate for
recurring subscription and transaction revenue plus any professional services
contracted for more than 12 months hence and secured new wins, excluding any
seasonal variations and lost contracts.
(2)Net retention rate is defined as the improvement in recurring revenue
excluding new wins in the last 12 months.
(3)EBITDA has been adjusted for the exclusion of share-based payment charges
along with depreciation, amortisation, interest and tax from the measure of
profit. EBITDA has also been adjusted to exclude costs and changes in the fair
value of consideration associated with the acquisition of EagleAI.
(4)Net cash is defined as cash and cash equivalents less financial
liabilities.
A year of profitable growth, with new customers secured across all key
geographies as retailers increasingly look to drive customer loyalty through
personalised engagement, at scale
· New customers secured in the UK, North America and Australasia and expansion
with existing customers including Tesco, Morrisons and Asda in the UK,
Hudson's Bay in North America and Woolworths in Australia and New Zealand.
· Exited the Year with strong ARR, up 19% year-on-year.
· Group revenue increased 11% to £47.7m, with license and transaction revenues
growing half-on-half and year-on-year.
· Maintained strong cost discipline, delivering adjusted EBITDA ahead of
original market expectations, increasing by 28% to approximately £11.3m.
· Net cash position at Year end of £10.4m, providing Eagle Eye with the
continued ability to invest to support future growth to achieve the Group's
ambitions.
Continued innovation of EagleAI to expand the Group's addressable market
· EagleAI (formerly Untie Nots) delivered new customer wins including Tesco,
Morrisons, Picard Surgeles and Chronodrive, and expansion with existing
customers Carrefour and E.Leclerc, providing significant contribution to the
growth in ARR.
· Ongoing innovation will result in a growing number of EagleAI offerings,
including 'Personalised Flyer', an AI powered personalised digital flyer to be
launched in 2025, with E.Leclerc secured as the first customer post Year end.
Contract win momentum provides a positive outlook for FY25 and beyond
· A number of new customer wins secured in the final month of the Year and at
the start of H1 2025, including the Group's first customer in Vietnam, RONA in
Canada, Waterstones Booksellers Limited in the UK and retailers in new
industries of Fuel and Convenience and eCommerce in New Zealand and France
respectively.
· These wins will commence revenue contribution through the course of FY25,
providing a strong foundation for FY25 onwards.
· With a significant and growing sales pipeline across all geographies, and
initiatives introduced to further enhance the win rate, the Board is confident
in the continued growth and strong performance of the Group.
Tim Mason, Chief Executive of Eagle Eye, said:
"Eagle Eye's reputation for delivering personalised marketing at scale,
combined with the new opportunities presented by our entry into data science
via EagleAI, provides a strong foundation for long-term growth. Our
significant sales pipeline, which has doubled over the course of the year,
includes some of the largest retailers in the world. The new initiatives to
enhance win conversion rates have already started to bear fruit and position
us well for continued success. The wins secured at the end of the Year and
into FY25 provide a strong basis for on-going growth. With robust cash
generation and a growing customer base globally, we are confident about the
future."
For further information, please contact: Tel: 0844 824 3686
Tim Mason, Chief Executive Officer
Lucy Sharman-Munday, Chief Financial Officer
Investec (Nominated Adviser and Joint Broker) Tel: 020 7597 5970
Corporate Broking: David Anderson / Nick Prowting
Shore Capital (Joint Broker) Tel: 020 7408 4090
Corporate Advisory: Daniel Bush / David Coaten / Lucy Bowden
Corporate Broking: Henry Willcocks
Alma Strategic Communications Tel: 020 3405 0205
Caroline Forde / Hannah Campbell / Kinvara Verdon
About Eagle Eye
Eagle Eye is a leading SaaS technology company enabling retail, travel and
hospitality brands to earn the loyalty of their end customers by powering
their real-time, omnichannel and personalised consumer marketing activities.
Eagle Eye AIR is a cloud-based platform, which provides the most flexible and
scalable loyalty and promotions capability in the world. More than 850 million
personalised offers are executed via the platform every week, and it currently
hosts over 500 million loyalty member wallets for businesses all over the
world. Eagle Eye is trusted to deliver a secure service at hundreds of
thousands of physical POS destinations worldwide, enabling the real-time
issuance and redemption of promotional coupons, loyalty offers, gift cards,
subscription benefits and more.
The Eagle Eye AIR platform is currently powering loyalty and customer
engagement solutions for enterprise businesses all over the world, including
Asda, Tesco, Morrisons, Waitrose and John Lewis & Partners, JD Sports,
Pret a Manger, Loblaws, Southeastern Grocers, Giant Eagle, and the Woolworths
Group. In January 2024, Eagle Eye launched EagleAI, a next-generation data
science solution for personalisation, already being used by leading retailers
worldwide including Carrefour, Auchan and Pattison Food Group. Web -
www.eagleeye.com (http://www.eagleeye.com) .
Chair Statement
I am very pleased to be reporting another year of strong profitable growth for
Eagle Eye, and one of strategic significance as the Group positions itself for
its next stage of growth. These results are evidence of the value customers
place in our offering, as the team continues to win new clients globally and
strengthen relationships with existing ones. Additionally, our exciting
AI-based offerings show significant potential for future growth.
This is my first time presenting Eagle Eye's results as Chair, having taken
over the role from Malcolm Wall in November 2023, after nine years of
exceptional leadership by him. My passion for technology and innovation led me
to Eagle Eye; it has always been an ambition of mine to deliver
personalisation at scale, given the opportunity it presents and the market's
growing appetite for it. Eagle Eye's technology means personalisation at scale
is truly here. The breadth and depth of its AIR platform and its ability to
leverage AI in a concrete way through its EagleAI offerings give the Group a
leading position in the loyalty and promotions market to build upon.
With this in mind, this year has seen the Board and management team
comprehensively assess the Group's strategy and operations to ensure we have
the foundations in place to achieve our next significant milestone of £100m
of revenue.
Financial results - Profitable growth and increasing ARR
The Group experienced good momentum, particularly towards the end of the Year,
increasing the Group's ARR by 19% to £39.7m at 30 June 2024 (30 June 2023:
£33.3m), providing confidence in further growth. Whilst revenue of £47.7m
(FY23: £43.1m) represented 11% growth Year on Year, growth was impacted by
the timing of Wins coming towards the end of the Year and the reduction in
non-core SMS revenue and so we believe the Group's true growth potential is
much higher. I am pleased to report that, due to the Group's strong cost
discipline, we delivered adjusted EBITDA ahead of original market
expectations, up by 28% to £11.3m (FY23: £8.8m). Profit after taxation
increased by 383% to £5.7m (FY23: £1.2m) reflecting the improvement in
operating performance and a tax credit for losses brought forward given the
continued growth in profitability. The Group generated cash in the Year, with
a net cash position of £10.4m at 30 June 2024 (30 June 2023: £9.3m),
providing the business with the continued ability to invest organically in
line with its growth ambitions.
Our People and Values
I have been truly impressed by the culture at Eagle Eye and its commitment to
its 'Purple' way of working, with our experienced and ambitious management
team leading by example. Eagle Eye has a passionate and united team which
truly lives and breathes our core values, in turn delivering exceptional value
to customers.
Eagle Eye believes that to be the best company to work with, you should be the
best company to work for, and there are a broad range of initiatives in place
across the business to support this. We continued to invest significantly in
training, including the rollout of 'Purple Leaders' training and the launch of
a new 'Purple Playbook', providing all team members with access to
personalised value-based coaching and development. Then at our annual
conference in July 2024, we launched a new employee recognition programme
'Purple Stars', identifying employees who have made significant contribution
to the business, starting with those that made an impact in FY24. These
initiatives are loved by our now 250+ strong team, contributing to our
fantastic Employee Net Promoter Score (eNPS) scores which we continue to track
quarterly.
Outlook - Positioned to achieve our growth ambitions
It is clear that omnichannel marketing by retailers is now the new normal.
Applied AI has arrived, and consumers increasingly expect, and want,
personalisation. Retailers have to react to these market dynamics to drive
their businesses forward and are increasingly turning to Eagle Eye to do so.
However, Eagle Eye is still only at the start of its growth journey. We are
making inroads in all our key markets, but our penetration of our target
customer base remains low, as they too are only at the start of their
personalised loyalty journeys. This provides Eagle Eye with a very
considerable runway of opportunity ahead. The Group has entered FY25 in a
strong position to achieve our growth ambitions over the next three to five
years, with a significant sales pipeline, energised team and powerful
offering.
Anne de Kerckhove, Chair of the Board
CEO Statement - Strategy & Operational Review
Strategy
The world of loyalty is evolving at pace, with grocers leading the way. For
them, loyalty increasingly means personalised marketing and engagement, due to
its proven ability to delight customers and increase loyalty, profitably. We
work with the leaders in the field, powering some of the world's most
successful loyalty programmes, providing us with outstanding reference
customers, globally. It is these leaders who are seeing the improvements in
profitability, proving that the personalisation at scale is delivering results
which in turn is heightening the urgency for all retailers to embrace
personalisation. This is why I am more excited than ever by the outlook for
Eagle Eye. Our ability to support the execution of personalised promotions at
huge scale, coupled with the growing opportunities from our new AI-based
offerings, provide us with a significant and growing opportunity.
The Group exited the Year with strong ARR, up 19% year-on-year, as we
continued to expand with existing customers and delivered good win momentum
towards the end of the Year. These contracts show that even the most advanced
retailers in personalised marketing, like Tesco, are seeking new ways to
engage and delight customers-evidenced by Tesco's rollout of EagleAI's
Personalised Challenges product to millions of Clubcard members.
We believe we can increase our revenue growth rate beyond the 11% achieved in
FY24. We have implemented some strategic enhancements that are intended to
accelerate our speed of pipeline conversion, and which have already started to
bear fruit.
The Wins achieved at the end of FY24 and into FY25 mean we anticipate
significant ARR growth in the year ahead. While this will naturally take time
to flow through to revenue, the inherent operational leverage in the business
means that over time the overall financial performance of the business should
be very powerful.
Achieving our next milestone of £100m revenue
Our ambition is to grow the business significantly, with our medium-term goal
to achieve the next milestone of a £100m revenue and 25% adjusted EBITDA
margin business and the timing couldn't be better - our exceptional offerings
position us at the forefront of a global personalised marketing revolution.
Given our track record of growth and the supportive market backdrop, we are
confident the business has the ability to double revenues in the medium-term,
from our current position of c.£50m to £100m in revenue. We feel that
various factors may accelerate the pace of growth, such as our entry into the
data science and AI space, through our new AI-based suite of personalisation
solutions, EagleAI; growth in non-grocery opportunities; growth in the partner
channel; and further M&A targeting the same 'ideal customer profile'
("ICP").
Alongside all this, even just small improvements in our speed of conversion
within our high growth markets, such as the US and Asia, will yield
significant returns. We now have a truly global presence, with North America
accounting for approximately half of Group revenue. International regions
delivered the highest growth rates in the Year, with North America up 9% and
APAC up 39%, alongside 6% growth in our more established European market. With
strong and growing pipelines, and low current market penetrations, these
regions represent considerable expansion opportunities for the Group.
Significant addressable enterprise market opportunity
Today, the majority of a retailer's value perception is driven via mass
marketing channels. However, the balance is shifting, with global leaders
recognising that they can drive a significantly greater ROI and improve the
customer experience by delivering personalised marketing to individualise how
customers perceive value. The promise of personalisation at scale to achieve
this has been around for many years, but only now is this becoming a reality
thanks to advances in cloud-computing, AI and the ability to communicate with
end consumers in real time. The world's largest management consultancies are
also championing personalisation like never before, supporting the excitement
about the future of the Group; according to BCG, shifting just 25% of spend to
targeted strategies can boost ROI by 200%. Eagle Eye is exceptionally
well-positioned to capitalise on this growing demand for personalised offers,
giving us a distinct edge in the market.
We currently generate more than 850m personalised offers a week and we don't
believe anyone else is doing more than us. We have footholds in sufficient
markets that can get us to £100m in revenue due to the size and growth of
those markets, and there is still so much more to go after. We're gaining
momentum in key markets, with 2.4% ICP penetration in North America and 3.4%
in the fast-growing APAC region. The UK & Ireland lead with 23.3%
penetration, offering strong upsell potential, while France and DACH also
present further opportunities for expansion.
By remaining focused on our growing pipeline and making calculated moves in
these key markets, we are well-positioned to reach and exceed our £100m
revenue target.
Driving our Win rate in FY25 and beyond
The Group has a considerable pipeline of sales opportunities, which includes
some of the world's largest retailers. Our current pipeline has doubled in
size compared to 12 months ago, reflecting our significant growth across a
diverse range of geographies and sectors. We have agreed four key programmes
of work to accelerate our pipeline conversion rate:
Increased focus on 'Win' within our sales organisation, supported by a more
mature sales process
We are changing the sales effort both structurally and through partnerships to
increase our focus on winning. Our sales teams' responsibilities have now been
split into Win focused roles, Account Managers and Customer Success, aimed at
winning new customers and better managing the customer lifecycle. We have
restructured existing roles and reengineered our customer management process
as well as investing in both technical sales resource and partnerships, to
make a meaningful difference in generating ARR. We have also implemented the
MEDDPICC sales process which has enhanced forecasting, information accuracy
and responsiveness, supporting our next stage of growth. This evolution is
complemented by increased global marketing efforts within a controlled budget,
as we continue to seek to achieve operational leverage.
Increased focus on alliances to expand the Group's reach
We are also sharpening our focus on partnerships to expand the Group's reach,
with the goal of driving a significant increase in the percentage of Group
revenue from partnerships. A key alliance is with Google, where we've made
significant progress, securing several client wins via the Google partnership
and building a substantial pipeline of opportunities globally thanks to joint
marketing activity in the Year. We are recognised as a top technology partner
and have been included in their Integrated Commerce IVN (Industry Value
Network).
Integrations have always been at the heart of how Eagle Eye operates due to
its central position within an integrated loyalty programme software stack. We
are seeing this being increasingly important to retailers with standardised
integrations now playing a crucial role in winning RFPs (Requests for
Proposals), and we will continue to invest in this area. commercetools was an
important technology partner launched in 2024, enabling commercetools'
customers to access Eagle Eye AIR capabilities out of the box.
We are also enhancing our collaboration with systems integrators who can take
on a greater proportion of the customer implementation work, meaning that as
our revenue grows, so can our global implementation capacity. Our Delivery
Team will work in conjunction with these new partners to ensure high customer
satisfaction is maintained. We are also actively seeking partnerships for
future geographic expansions, including a referral scheme with select
partners.
Increased productisation of our technology to facilitate simplified sales
discussions and easier integration and implementation
As part of enabling greater growth through alliances, we are focused on making
our technology more digestible by creating more packaged offerings alongside
standardising and simplifying documentation and support collateral. While
still allowing for customisation, these packaged products will simplify
implementation for both us and our future partners, driving efficiency and
profitability. This approach also enables a streamlined and accessible
solution for the mid-size market, making it easier to use and maintain.
Overall, our emphasis is on simplification and focus, ensuring an efficient
and effective offering.
Continued innovation, particularly within EagleAI, to capitalise on the
growing interest in AI-powered personalisation execution
The Untie Nots offering has now been fully rebranded as EagleAI. EagleAI
currently powers two core solutions, with a clear future roadmap. Personalised
Challenges were launched in 2017 and Personalised Promotions launched in 2024.
Cloud technologies have made AI considerably more accessible, and our approach
is to build modules to enable customers to buy applied AI in manageable
'chunks', rather than having to take on a major additional platform. We will
work with a client on the development of each use case, to ensure it has clear
ROI at point of launch and a strong market fit.
EagleAI won several customers through these two solutions in the Year, as
detailed in the operational review below, which will drive significant Eagle
AI revenue growth in FY25, from contracts already secured.
2025 will see the launch of the Personalised Flyer, with France's leading
Grocer, E.Leclerc, as our reference customer. The offering leverages Eagle
Eye's existing and new AI machine learning capabilities to create a digital,
highly personalised version of the traditional grocery flyer, a promotional
tool for advertising sales, discounts and special offers which is either
distributed via print or made available online. Promotional flyers attract
customers, encourage larger purchases, and help retailers clear inventory, but
are largely still mass produced. Our flyer will be personalised for each
customer, making it a far more effective marketing tool. This new product
strengthens our offering in the French and US markets in particular, where the
use of digital flyers is well established, particularly in France as the use
of paper flyers has recently been banned and where E.Leclerc will serve as a
strong reference customer.
In FY25 we will also continue with the development of applications that
develop audience building, personalised prices and personalised content.
Outlook
The case for adopting personalisation is stronger than ever and those that
have adopted personalisation are increasingly using it for a greater number of
applications. We believe only Eagle Eye can meet this growing enterprise
demand with the necessary speed, scalability, stability and security.
The world of loyalty is evolving at pace and Eagle Eye's market-leading
reputation as the provider of personalised marketing at scale, and the
increasing opportunities available to us through the Group's new AI-based
offerings, provide us with a strong foundation for long-term growth.
We have a significant sales pipeline, including some of the leading businesses
across multiple sectors and geographies, and have implemented new initiatives
to drive our win rate. The wins secured at the end of FY24 and at the start of
the new financial year have meant we entered FY25 in a strong position to
drive further growth throughout the Year and beyond. With healthy levels of
cash generation, a growing international customer base and new AI-based
offerings, the Board looks to the future with confidence.
Operational Review
Delivering against our strategic framework
1. Customer strategy: Win, Transact, Deepen
We continued to successfully deliver across the three areas of our customer
strategy in the Year - Win, Transact and Deepen.
· 'Win': bring more customers into the Group;
· 'Transact': drive volumes; and
· 'Deepen': encourage our customers to adopt more of our product
portfolio
Win
A key focus for the Group is to drive our win rate for future growth. During
the Year, we secured a good level of wins across our key geographies; we now
have ten customers in North America and a growing presence in Europe and Asia,
alongside our long-standing UK presence. Our high level of customer retention
means that each new customer win significantly adds to our growth prospects,
through customers' expanding the use of the platform and the addition of new
services over time.
Key AIR wins in the Year include a five-year loyalty contract with a large pet
supply company in North America, a three-year contract with one of Australia's
leading drinks and hospitality businesses, Endeavour Group, and a five-year
contract with Pattison Food Group (PFG), Western Canada's largest grocery
retailer, which included a contract for Personalised Promotions from EagleAI.
In the final month of the Year and at the start of FY25, we secured a number
of new AIR customers including a three-year contract with Central Retail
Vietnam, the Group's first customer in Vietnam, a three-year contract with a
retailer in a new industry of Fuel and Convenience in New Zealand, a
three-year contract with RONA in Canada, and a five-year contract with
Waterstones Booksellers Limited in the UK. The wins will commence revenue
contribution through the course of FY25, providing a strong basis for further
growth through FY25 into FY26.
EagleAI also secured a good level of new customers, particularly in the second
half of the Year, including PFG, as mentioned above, Tesco Stores Ltd,
Morrisons and French retailers Picard Surgeles and Chronodrive, EagleAI's
first eCommerce customer.
Transact
Chargeable AIR redemption and loyalty interaction volumes, a key measure of
usage of Eagle Eye AIR, increased by 14% to 3.8 bn (FY23: 3.3 bn). This was
driven in particular by the Woolworths Group contract, which expanded into new
use cases and a major expansion into Woolworths' New Zealand business, adding
a further 1.6 million loyalty members to the programme. Total Application
Programming Interface (API) requests via AIR increased by 27% year-on-year to
89.9bn (FY23: 70.1 bn). Transaction volume growth was also driven by the
growing success of Asda's loyalty programme, Asda Rewards, and in the latter
part of the Year by Morrisons.
Deepen
The Group's performance was supported by the deepening of existing
relationships, including expansion with Woolworths Group and Asda and
Morrisons in the UK, as described above. Further customer expansions include
Staples US Retail and the deepening of our partnership with Mitchells &
Butlers through the launch of its Employee Rewards app as well as an app
targeting suppliers, providing discounts at venues across the UK.
We have also seen good levels of deepening for EagleAI, the Group's AI-based
personalised promotions offering, which expanded with existing customers,
including both Carrefour and E.Leclerc, who have signed a 24-month renewal for
the Personalised Challenges product, which is to be delivered through the
Google Cloud Marketplace. They are also the flagship customer for the new
Personalised Flyer product.
The continued expansion with customers and strong progress with EagleAI
contributed to growth in ARR of 19% to £39.7m as at the Year end, providing a
solid foundation for growth in FY25.
2. Innovation
Innovation sits at the heart of everything we do at Eagle Eye. As one of seven
core company values, we pride ourselves on innovating both with and for our
customers to deliver value which ultimately helps the businesses we work for
better delight their consumers. Innovation has enabled us to continually
deliver new solutions to the market in the Year which differentiate us and
enable us to provide added value to our core customer base. We were delighted
to be named the 7th most innovative marketing technology company globally by
the TMW 100 awards, where we also received the prestigious Judges' Pick
accolade.
Innovation is in our DNA and we will continue to celebrate our teams for
delivering new capabilities as it is critical to our future success. We have
continued to innovate to expand the Group's addressable market, focusing on
our AI-based offering, EagleAI, validated by initial customer wins described
above.
From an AIR platform perspective, our key focus has been on continuing to
develop new functionality to ensure that we are the most complete and most
flexible loyalty and promotions personalisation platform on the market:
Real-Time Loyalty key feature developments:
· Advanced loyalty tiering capability which allows retailers to flex how
customers can earn their way into different tiers, as well as being able to
dictate different rules for how loyalty points can be earned and spent within
unique tiers.
· Support for savers and short-term collectible schemes e.g. Christmas Saver
pots.
· Pending points capability to prevent points being spent during a product
refund period.
· Auto-converting points to vouchers at pre-configured milestones.
Extending our unique Cloud-Based Adjudication service:
· Support for product exchanges to provide a seamless and accurate exchange
process, adjudicating changes to the basket to ensure that all discounts,
points, and rewards are correctly managed.
· Developed a new adjudication capability to allow retailers greater flexibility
to process adjustments and award customers points against previous
transactions.
Delivering new capabilities to support customers in new sectors and
geographies:
· Universal coupon codes for eCommerce journeys e.g. BLACKFRIDAY10.
· Multi-stage points/discount fulfilment; ensuring customers are only correctly
rewarded once their items have been delivered.
· commercetools integration to enable retailers to access AIR's loyalty and
promotional functionality directly through the commercetools platform.
· Increased support for new sectors e.g. fuel-specific loyalty scheme and
promotional management.
· Developed new capabilities to support our expansion into new markets such as
localising our AIR dashboard into new languages.
Continuing to focus on leading the market when it comes to platform speed and
scale:
· Scaled our ability to transact up to 10,000 transactions per second.
· Reduced our key API response times for retailer critical systems e.g. Point of
Purchase, by 50% to under a quarter of a second.
· Streamlined data flows and coupon allocation processes, enabling us to deliver
billions of personalised offers worldwide every week, twice as fast as we
could just a year ago.
Internal use of AI
Following on from the explosion of AI use cases across businesses globally, we
have successfully embedded AI across all our teams, with the aim to run the
business in a Better, Simpler, Cheaper way. We're using AI within our
operations teams to help understand our monitoring and alerting data, meaning
we can respond quicker to issues and incidents; our engineers are using AI to
assist with writing and testing code, and our sales teams are using AI to help
manage their deals and accounts, reducing the time spent on day-to-day work.
The biggest deployment of AI has been rolling out an enterprise search tool,
which sits across all the tools our teams use on a daily basis, allowing them
to quickly find the right information and knowledge, and chat with the data
that exists in those platforms. We estimate we can save around 70,000
man-hours a year with this capability alone. In the year we rolled out AI
training across the business, so our employees can make best use of AI,
including gaining a better understanding of the use cases AI can help with,
and courses on prompt-engineering, so we can all make the most of generative
AI. We have added an AI module to our onboarding programme, so all new
starters hit the ground running. All this is being done to gain efficiencies,
allowing us to reinvest the time we're saving to support our growth.
3. International growth
As described above, we have footholds in many of the major, high growth
loyalty markets around the world, with considerable potential for further
expansion.
The benefits of our investment into international expansion to date are
evident in the high number of international customers secured in the Year,
with highlights including the expansion of our North American customer base to
10 and entry into the DIY sector via RONA in Canada; in APAC our first
customer win in Vietnam and entry into the Fuel and Convenience sector in New
Zealand; and in France multiple new EagleAI customers including our first pure
eCommerce business.
We continue to see opportunities for international expansion:
· Within our established European markets, we are focused on the cross sell of
AIR into EagleAI's customer base and will continue to deepen existing AIR
customers with EagleAI products as we have done with the likes of Morrisons,
Tesco and Asda.
· In the DACH region, where we are just at the start of our journey.
· North America, the largest promotions and loyalty market in the world, for
which our soon to launch Personalised Flyer offering is particularly relevant.
· In APAC we now have strong reference customers in Australia, New Zealand,
Taiwan and Indonesia, and have secured our first customer in Vietnam.
In order to capitalise on this increased presence and opportunity, we
increased investment in marketing activities in the Year, attending more trade
shows than before across multiple regions, increasingly alongside our partner,
Google. In FY24, Eagle Eye attended 36 trade shows and events, up 112% from 17
in FY23. This has significantly contributed to an increase in the number of
opportunities entering our sales pipeline across all geographies as retailers
look to drive customer loyalty through personalised promotions, at scale.
4. Better, Simpler, Cheaper
While investing in innovation and growing the business, we simultaneously look
for inherent productivity and efficiencies coming from the scale of what we
do. The Group has maintained strong cost discipline, delivering adjusted
EBITDA ahead of original market expectations, increasing by 28% to £11.3m
(FY23: £8.8m). This was alongside good growth in adjusted EBITDA margin to
24% (FY23: 20%) demonstrating the operating leverage within the business and
ongoing 'better, simpler, cheaper' initiatives.
5. M&A
The successful acquisition of EagleAI demonstrates the benefits Eagle Eye can
bring to other businesses looking to scale, and the benefits they can bring to
the Group. We have a proven, strong organic growth strategy, and any future
M&A can be considered as a lever for accelerating us towards our vision to
be a £100m revenue business generating 25% EBITDA margin.
Our people
At Eagle Eye, creating value for our customers is central to our success,
driven by our Purple People who follow the Golden Rule: treating others as
they wish to be treated. This principle is at the core of both our world-class
culture and our effort to power the personalised marketing revolution
globally. Our commitment was recognised this year, as we ranked 7th in the
Best Companies to Work For and 5(th) in Technology's Best Company to Work For
in the UK. Whilst we are proud of this achievement, we are consistently aiming
higher and have ambitions to be the best company to work for.
Following the AGM in November 2023, Malcolm Wall retired as Chair of Eagle
Eye. We thank him for his significant guidance since 2014. Anne de Kerckhove,
our new Chair, brings extensive experience in technology, media, and
entertainment, and has already made positive contributions to the Group. We
are excited to have her lead us into the next stage of growth.
Tim Mason, Chief Executive Officer
Financial review
Key Performance Indicators
Financial FY24 FY23
£m £m Var
Revenue 47.7 43.1 11%
Subscription and transaction revenue:
- AIR Licence revenue £14.8m 31% £14.1m 32% 5%
- AIR transaction revenue £16.8m 35% £15.7m 37% 7%
- EagleAI Licence & transaction revenue £4.4m 9% £2.2m 5% 100%
- SMS transaction revenue £1.4m 3% £2.4m 6% (42)%
Total subscription and transaction revenue £37.5m 79% £34.5m 80% 9%
Annual recurring revenue 39.7 33.3 19%
Net revenue retention rate 109% 137% (28)ppt
Adjusted EBITDA ((1)) 11.3 8.8 28%
Adjusted EBITDA ((1)) margin 23.6% 20.4% 3.2ppt
Profit after tax 5.7 1.2 383%
Net cash ((2)) 10.4 9.3 12%
Cash and cash equivalents 10.6 10.6 0%
Financial liabilities (0.2) (1.3) (87)%
Non-financial FY24 FY23
Chargeable AIR redemption & interaction volumes 3.8bn 3.3bn 14%
Long-term contract customer churn by value 1.7% 0.2% 1.5ppt
((1)) Adjusted EBITDA excludes costs and changes in the fair value of
contingent consideration associated with the acquisition of Unite Nots SAS,
share-based payment charges along with depreciation, amortisation, interest
and tax from the measure of profit and is reconciled to the GAAP measure of
profit before taxation in note 5.
((2)) Net cash is cash and cash equivalents less financial liabilities.
Group results
Revenue
The Group's Annual Recurring Revenue (ARR), which is our period exit rate for
recurring AIR and EagleAI (formerly Untie Nots) subscription and transaction
revenue, plus any professional services contracted for more than 12 months
hence and secured new wins, excluding any seasonal variations and lost
contracts, increased by 19% to £39.7m (FY23: £33.3m). The growth rate in ARR
is higher than the overall revenue growth due to the timing of new wins and
the impact of the expected reduction in SMS messaging revenue in the Year
(which is not included in ARR). New contracts secured post-year end have
increased ARR further, as additional 'win' initiatives start to deliver
results. This ARR growth included strong progress with EagleAI and provides a
good foundation for the year ahead, as the timing of wins means that revenue
recognition from these contracts will benefit FY25 onwards.
Revenue growth for the Group was 11% for the Year (FY23: 36%). Recurring
revenue grew by 9% to £37.5m (FY23: £34.5m) as clients continued to grow
volumes as they take on new services and reflecting the full year impact of
the acquisition of EagleAI in FY23, offset by the 42% reduction in SMS
revenue. This was supported by growth in professional services revenue of 20%
to £10.2m (FY23: £8.6m). Under IFRS 15, a SaaS business will typically
recognise revenue (including implementation revenue from professional
services) over time. In some cases, this means implementation revenue is now
recognised over the period the service is live. Therefore, during the period
of implementation for a new client, which is typically between two and six
months, no revenue will be recognised. Directly attributable associated costs
are also spread over the same period, matching revenue and costs. Revenue from
professional services that has been deferred into future periods, but
delivered and billed, was £5.9m at 30 June 2024 (30 June 2023: £5.8m).
The Group has continued to deepen client relationships resulting in a Net
Revenue Retention (NRR) rate, which is the improvement in recurring revenue
excluding new wins in the last 12 months, of 109% (FY23: 137%). This reduction
reflects both a UK grocery customer contract reaching the end of its lifecycle
in September 2023 and the timing of wins being later in the year and thus
reducing their impact in the reported number. Excluding the impact of the UK
grocery customer, NRR in FY24 would have been 117%. Chargeable AIR redemption
and loyalty interaction volumes, a key measure of usage of the AIR platform,
increased by 14% to 3.8bn (FY23: 3.3bn), ahead of the growth in recurring
subscription and transaction revenue, reflecting increasing transactional
usage of the platform by all our grocery clients, in particular for loyalty
transactions where we have seen key customers such as Woolworths and Asda
continuing to move through their contract cycle with volumes from their
services increasing within their existing licence and transaction fee charging
bands.
The Group successfully maintained a low rate of long-term contract customer
churn by value at 1.7% (FY23: 0.2%). This reflects the scale and breadth of
the AIR platform's offering in meeting our customers' needs. The increase in
the Year primarily reflected the cessation of the contract with the one UK
grocery customer mentioned above, which had not been fully integrated to the
AIR platform.
Gross profit
Gross profit grew 13% to £46.5m (FY23: £41.0m), with gross margin increasing
to 97% (FY23: 95%) as the contribution to revenue from the lower margin SMS
business continues to reduce; a trend which is expected to continue into FY25.
Costs of sales include the cost of sending SMS messages, revenue share
agreements, including the cost of sales made through the Google marketplace,
and outsourced, bespoke development work. All internal resource costs are
recognised within operating costs, net of capitalised development and contract
costs.
Direct profit
With the acquisition of EagleAI, the development of packages and continued
reduction in the proportion of revenue generated from SMS messaging, the
relevance of gross profit as a performance measure is declining. We are,
therefore, developing a new measure of 'direct' profit which more accurately
reflects the margin directly generated by the revenue recognised in the Year.
In addition to the costs of sales as defined above, this measure also includes
the costs of the AIR and EagleAI platforms (including associated software
licenses) and staff costs for employees dedicated to the successful
implementation and ongoing running of client services. In the Year, direct
profit increased to £34.9m (FY23: £31.1m) with margin increasing from 72% to
73%. Our ambition is to see this margin continue to increase as the platform
is made more efficient as transaction volumes continue to increase.
Adjusted operating expenses
Adjusted operating costs were controlled broadly in line with revenue growth
and increased by 10% to £35.4m (FY23: £32.3m) as the business invested in
line with our growth model. These operating expenses, which exclude a credit
in the Year of £1.3m related to the release of contingent consideration and
FY23 costs of £1.3m associated with the acquisition of EagleAI, represent
sales and marketing, product development (net of capitalised costs),
operational IT, general and administration costs.
Staff costs increased 11%, in line with revenue growth, to £27.5m (FY23:
£24.8m), which was for the most part attributable to an increase in average
headcount for the Year to 257 (FY23: 222), reflecting the full year impact of
the acquisition of EagleAI in FY23. We continue to invest in developing our
products, and in sales and marketing to support our growth plan; within staff
costs, gross expenditure on product development increased to £7.6m (FY23:
£6.9m) and sales and marketing spend was £6.3m (FY23: £4.8m), driven by a
37% increase in marketing spend, including increased attendance at trade
events, which has helped to generate the increase in ARR through wins in the
latter half of the Year.
IT Infrastructure costs grew to £9.6m; representing 26% of recurring revenue
(FY23: £8.1m; 23% of recurring revenue), reflecting the full period impact of
the acquisition of EagleAI as well as the continued investment in the speed,
stability and security of the platform. Work continues to optimise the
efficiency of our infrastructure as we continue to grow.
Capitalised product development costs were £2.9m (FY23: £2.6m), whilst
amortisation of capitalised development costs was £2.9m (FY23: £2.5m).
Contract costs (including costs to obtain contracts and contract fulfilment
costs), recognised as assets under IFRS 15, increased to £3.8m (FY23:
£2.8m), primarily reflecting the implementation of new wins during the Year,
some of which were yet to go live at 30 June 2024, and amortisation of
contract costs was £3.6m (FY23: £1.7m).
Adjusted EBITDA and profit/(loss) before tax
Continued controlled investment spend in the Year has resulted in continued
growth in organic adjusted EBITDA margin to 25% (FY23: 21%). Reflecting its
earlier stage of growth, EBITDA margin for EagleAI increased to 6% (FY23: 4%),
resulting in the adjusted EBITDA margin for the Group increasing to 24% (FY23:
20%). Adjusted EBITDA was up 28% at £11.3m (FY23: £8.8m) for the Year.
To provide a better guide to the underlying business performance, adjusted
EBITDA excludes the FY23 costs of the acquisition of EagleAI and FY24 credit
of contingent consideration associated with that acquisition, along with
share-based payment charges, depreciation, amortisation, interest and tax from
the measure of profit. The GAAP measure of operating profit before interest
and tax was £0.8m (FY23: loss of £(0.6)m).
This increase reflects the improved EBITDA performance, the £1.3m credit
related to the release of contingent consideration on the acquisition of
EagleAI in FY24 and the FY23 costs associated with the acquisition of EagleAI
(£1.3m), offset by amortisation which increased to £8.9m (FY23: £5.7m),
primarily as a result of intangibles recognised under IFRS 3 on the
acquisition of EagleAI and the increased non-cash share-based payment charge
of £2.8m (FY23: £2.4m), reflecting successful performance and the strong
position the Group continues to be in to deliver increased revenue and
profits, which are reflected in future, performance related, vesting
assumptions.
The profit before tax for FY24 was £0.7m (FY23: loss of £(0.8)m), reflecting
the improved operating profit before interest and tax. Net finance expense
reduced to £0.11m (FY23: £0.14m) reflecting the repayment of the partial
utilisation of the Group's revolving loan facility and debt acquired in the
EagleAI acquisition.
Profit after tax, EPS and dividend
The improvement in underlying profitability during the Year, in particular in
the UK, has allowed the Group to forecast the further recovery of taxable
losses brought forward from prior years with more certainty which has resulted
in an increase in the deferred tax asset of £6.8m, reflecting historic losses
brought forward now being recognised. Along with the continued successful
R&D tax credit claims in the UK and France, this has resulted in an
overall tax credit of £5.0m in FY24 (FY23: credit of £1.9m).
As a result, the Group's profit after taxation increased to £5.7m (FY23:
£1.2m) and reported basic earnings per share improved to 19.47p (FY23: 4.25p)
with diluted earnings per share of 17.36p (FY23: 3.79p).
No dividend is proposed this year (FY23: £nil) as the Group continues to
invest in a managed way to pursue our growth strategy.
Group Statement of Financial Position
The Group had net assets of £34.1m at 30 June 2024 (30 June 2023: £24.0m),
including capitalised intellectual property of £5.4m (30 June 2023: £5.3m).
The movement in net assets primarily reflects the underlying profit made
during the Year, which has given further confidence to future profits allowing
the recognition of deferred tax assets for the utilisation of losses carried
forward which arose as Eagle Eye invested for successful growth in prior
periods.
Net current assets increased by £3.5m primarily due to a lower bonus accrual
offset by lower receivables, primarily reflecting improved debt collection. In
addition, the cash generated in the Year was utilised to make repayments
against the Group's revolving credit facility and the debt acquired with
EagleAI. Liabilities decreased by £6.4m primarily due to this repayment of
debt, deferred consideration paid to the vendors of Untie Nots, contingent
consideration released and a lower bonus accrual, reflecting lower revenue
growth in the Year compared to previous periods.
Cashflow and net cash
The Group ended the Year with net cash of £10.4m (30 June 2023: £9.3m).
Overall net cash inflow for the Year was £1.1m. The main cash movements were:
· the conversion of the improved EBITDA profitability during the Year;
· capital investment in the AIR and EagleAI platforms and other infrastructure
of £3.3m (FY23: £2.6m), as well as contract costs capitalised under IFRS 15
of £3.6m (FY23: £2.8m);
· repayment of debt of £1.1m (FY23: £1.6m);
· payments in respect of leases of £0.6m (FY23: £0.2m);
· net tax payments of £0.3m (FY23: net tax receipt of £0.9m) reflecting that
the payment of R&D tax credits in France has been delayed by 6 months
following the change of accounting period of the French subsidiary; and
· £0.7m deferred consideration paid for the acquisition of EagleAI.
Banking facility
The Group has remained comfortably within its banking covenants which relate
to the Group's debt ratio and adjusted EBITDA performance. The Group continues
to hold a £5.0m revolving loan facility with HSBC Innovation, with an
additional £2.5m accordion facility available, subject to credit approval at
the time. The Group is currently well advanced in the renewal of the facility.
This provides the business with security and flexibility over its financing
options to deliver on its growth aspirations. The Group's gross cash of
£10.6m (FY23: £10.6m) and the currently unutilised £5.0m facility (FY23:
£4.0m undrawn), less £0.2m debt of EagleAI, gives the Group £15.4m of
headroom, which, with the growing levels of profitability and organic cash
generation, the Directors believe is sufficient to support the Group's current
organic growth plans.
The Group hedges elements of its foreign currency net receipts to ensure that
it is protected from significant and sudden adverse movements in foreign
currency exchange rates. There were no open hedges at 30 June 2024 (30 June
2023: none).
Consolidated statement of profit or loss and total comprehensive income
for the year ended 30 June 2024
2023
2024
Note £000 £000
Continuing operations
Revenue 3 47,733 43,074
Cost of sales (1,283) (2,091)
Gross profit 46,450 40,983
Operating expenses (45,814) (41,725)
Other income 195 122
11,260
Adjusted EBITDA ((1)) 8,789
Acquisition costs - (1,298)
Change in fair value of contingent consideration 1,303 -
Share-based payment charge (2,835) (2,426)
Depreciation and amortisation (8,897) (5,685)
Operating profit/(loss) 831 (620)
Finance income 41 30
Finance expense (153) (170)
Profit/(loss) before taxation 719 (760)
Taxation 5,015 1,948
5,734 1,188
Profit after taxation for the financial year
(333) (410)
Foreign exchange adjustments
Total comprehensive profit attributable to the owners of the parent for the 5,401 778
financial year
((1)) Adjusted EBITDA excludes share-based payment charge, depreciation and
amortisation from the measure of profit along with the costs associated with
the acquisition of Untie Nots SAS in 2023 and subsequent changes in fair value
of contingent consideration due on that acquisition.
Earnings per share
From continuing operations
Basic 4 19.47p 4.25p
Diluted 4 17.36p 3.79p
Consolidated statement of financial position
as at 30 June 2024
2024 2023
£000 £000
Non-current assets
Intangible assets 17,804 19,458
Contract fulfilment costs 2,610 2,562
Property, plant and equipment 1,175 1,444
Deferred taxation 8,455 1,626
30,044 25,090
Current assets
Trade and other receivables 10,349 11,085
Current tax receivable 183 762
Cash and cash equivalents 10,576 10,615
21,108 22,462
Total assets 51,152 47,552
Current liabilities (10,583) (14,252)
Trade and other payables - (74)
Current tax payable
IFRS 15 deferred income (3,002) (3,086)
Financial liabilities (122) (1,102)
(13,707) (18,514)
Non-current liabilities
Other payables (412) (2,131)
IFRS 15 deferred income (2,927) (2,670)
Financial liabilities (50) (197)
(3,389) (4,998)
(17,096) (23,512)
Total liabilities
Net assets 34,056 24,040
Equity attributable to owners of the parent
Share capital 296 293
Share premium 30,089 29,925
Merger reserve 3,278 3,278
Share option reserve 9,084 7,291
Retained losses (8,691) (16,747)
Total equity 34,056 24,040
Consolidated statement of changes in equity
for the year ended 30 June 2024
Share capital Share Merger Share option Retained losses Total
premium reserve reserve
£000 £000 £000 £000 £000 £000
Balance at 1 July 2022 264 17,685 3,278 5,549 (18,209) 8,567
Profit for the financial year - - - - 1,188 1,188
Other comprehensive income
Foreign exchange adjustments - - - - (410) (410)
- - - - 778 778
Transactions with owners recognised in equity
Issue of share capital 22 12,148 - - - 12,170
Issue costs - (285) - - - (285)
Exercise of share options 7 377 - - - 384
Fair value of share options exercised in the year - - - (684) 684 -
Share-based payment charge - - - 2,426 - 2,426
29 12,240 - 1,742 684 14,695
293 29,925 3,278 7,291 (16,747) 24,040
Balance at 30 June 2023
Profit for the financial year - - - - 5,734 5,734
Other comprehensive income
Foreign exchange adjustments - - - - (333) (333)
- - - - 5,401 5,401
Transactions with owners recognised in equity
Exercise of share options 3 164 - - - 167
Fair value of share options exercised in the year - - - (1,042) 1,042 -
Share-based payment charge - - - 2,835 - 2,835
Deferred tax on share-based payments - - - - 1,549 1,549
Deferred tax on losses - - - - 64 64
3 164 - 1,793 2,655 4,615
296 30,089 3,278 9,084 (8,691) 34,056
Balance at 30 June 2024
Included in Retained losses is a cumulative foreign exchange profit of
£436,000 (2023: profit £103,000).
Consolidated statement of cash flows
for the year ended 30 June 2024
2024 2023
£000 £000
Cash flows from operating activities
Profit/(loss) before taxation 719 (760)
Adjustments for:
Depreciation 718 487
Amortisation 8,180 5,198
Share-based payment charge 2,835 2,426
Finance income (41) (30)
Finance expense 153 170
Decrease/(increase) in trade and other receivables 544 (3)
(Decrease)/increase in trade and other payables (2,019) 3,850
Movement on contingent consideration for acquisition of Untie Nots (1,303) -
Income tax paid (313) (56)
Income tax received 10 960
9,483 12,242
Net cash flows from operating activities
Cash flows from investing activities
Payments to acquire property, plant and equipment (346) (171)
Payments to acquire intangible assets and contract fulfilment costs (6,711) (5,444)
Acquisition of Untie Nots, net of cash and cash equivalents acquired (654) (6,347)
(7,711) (11,962)
Net cash flows used in investing activities
Cash flows from financing activities
Net proceeds from issue of equity 167 7,097
Proceeds from borrowings - 2,000
Repayment of borrowings (1,123) (1,627)
Capital payments in respect of leases (545) (217)
Interest paid in respect of leases (80) (31)
Interest received 41 4
Interest paid (73) (113)
(1,613) 7,113
Net cash flows from financing activities
Net increase in cash and cash equivalents in the year 159 7,393
Foreign exchange adjustments (198) (410)
Cash and cash equivalents at beginning of year 10,615 3,632
10,576 10,615
Cash and cash equivalents at end of year
Notes to the consolidated financial statements
1 Accounting policies
Basis of preparation
The financial information set out herein does not constitute statutory
accounts as defined in Section 434 of the Companies Act 2006. The financial
information for the Year ended 30 June 2024 has been extracted from the
Group's audited financial statements which were approved by the Board of
Directors on 17 September 2024 and which, if adopted by the members at the
Annual General Meeting, will be delivered to the Registrar of Companies for
England and Wales.
The financial information for the Year ended 30 June 2023 has been extracted
from the Group's audited financial statements which were approved by the Board
of Directors on 18 September 2023 and which have been delivered to the
Registrar of Companies for England and Wales.
The reports of the auditor on both these financial statements were
unqualified, did not include any references to any matters to which the
auditors drew attention by way of emphasis without qualifying their report and
did not contain a statement under Section 498(2) or Section 498(3) of the
Companies Act 2006.
The information included in this preliminary announcement has been prepared on
a going concern basis under the historical cost convention, and in accordance
with UK-adopted International Accounting Standards in conformity with the
requirements of the Companies Act 2006 and the International Financial
Reporting Interpretations Committee (IFRIC) interpretations issued by the
International Accounting Standards Board ("IASB") that are effective as at the
date of these financial statements.
The Company is a public limited Company incorporated and domiciled in England
& Wales and whose shares are quoted on AIM, a market operated by The
London Stock Exchange.
2 Going concern
As part of their going concern review the Directors have followed the
guidelines published by the Financial Reporting Council entitled "Guidance on
the Going Concern Basis of Accounting and Reporting on Solvency and Liquidity
Risks- Guidance for directors of companies that do not apply the UK Corporate
Governance Code".
The Directors have prepared detailed financial forecasts and cash flows
looking 3 years beyond the date of these consolidated financial statements. In
developing these forecasts, the Directors have made assumptions based upon
their view of the current and future economic conditions that will prevail
over the forecast period.
On the basis of the above projections, the Directors are confident that the
Group has sufficient working capital and available funds to honour all of its
obligations to creditors as and when they fall due. In reaching this
conclusion, the Directors have considered the forecast cash headroom,
including the impact of the revolving credit facility with HSBC Innovation
Bank and the covenants associated with it, the resources available to the
Group and the potential impact of changes in forecast growth and other
assumptions, including the potential to avoid or defer certain costs and to
reduce discretionary spend as mitigating actions in the event of such changes.
Accordingly, the Directors continue to adopt the going concern basis in
preparing these consolidated financial statements.
3 Segmental analysis
The Group is organised into two principal operating divisions for management
purposes. These reflect the organic Eagle Eye business and the EagleAI
business acquired in 2023. All non-current assets are held in the United
Kingdom, other than the right of use asset relating to the lease for the Paris
office of EagleAI and capitalised intellectual property of EagleAI.
Organic EagleAI Total Organic EagleAI Total
2024 2024 2024 2023 2023 2023
£000 £000 £000 £000 £000 £000
Revenue 43,309 4,424 47,733 40,862 2,212 43,074
Cost of sales (1,283) - (1,283) (2,091) - (2,091)
42,026 4,424 46,450 38,771 2,212 40,983
Gross profit
Adjusted operating costs (31,037) (4,153) (35,190) (30,060) (2,134) (32,194)
10,989 271 11,260 8,711 78 8,789
Adjusted EBITDA
Revenue is analysed as follows:
Service 2024 2023
£000 £000
Development and set up fees 10,249 8,563
Subscription and transaction fees 37,484 34,511
47,733 43,074
Product 2024 2023
£000 £000
AIR revenue 41,911 38,440
EagleAI revenue 4,424 2,212
Messaging revenue 1,398 2,422
47,733 43,074
4 Earnings per share
The calculation of basic earnings per share is based on the result
attributable to ordinary shareholders divided by the weighted average number
of ordinary shares in issue during the year. The calculation of diluted
earnings per share is based on the result attributable to ordinary
shareholders divided by the weighted average number of shares in issue during
the year, diluted for the effect of options being converted to ordinary
shares. Basic and diluted earnings per share from continuing operations is
calculated as follows:
Earnings per Profit 2024 Earnings per Profit 2023
share £000 Weighted average number of ordinary shares share £000 Weighted average number of ordinary shares
pence pence
Basic earnings per share 19.47 5,734 29,447,934 4.25 1,188 27,942,991
Diluted earnings per share 17.36 5,734 33,023,177 3.79 1,188 31,380,031
5 Alternative performance
measure
Adjusted EBITDA is a key performance measure for the Group and is derived as
follows:
2024 2023
£000 £000
Profit/(loss) before taxation 719 (760)
Add back:
Finance income and expense 112 140
Share-based payments 2,835 2,426
Depreciation and amortisation 8,897 5,685
Acquisition cost - 1,298
Change in fair value of contingent consideration (1,303) -
Adjusted EBITDA 11,260 8,789
6 Net cash
Net cash is a key performance measure for the Group and is defined as follows:
30 June Cash flow Foreign exchange adjustments 30 June 2024
2023
£000 £000 £000 £000
Cash and cash equivalents 10,615 159 (198) 10,576
Financial liabilities (1,299) 1,127 - (172)
1,286 (198)
Net cash 9,316 10,404
7 Business combinations
As disclosed in the annual report for the year ended 30 June 2023, on 3
January 2023, Eagle Eye Group plc completed the acquisition of 100% of the
issued share capital of Untie Nots SAS. The provisional fair value of the net
assets acquired was determined to be £12.3 million and no adjustment is to be
made following the completion of the twelve month hindsight period.
Contingent consideration is due to be paid in FY25 subject to specific revenue
targets being achieved in the year to December 2024 and achievement of a
minimum EBITDA margin. The minimum targets for contingent consideration are
not expected to be achieved in the timescales required and therefore this
consideration has been released during the Year. In accordance with IFRS 3
this has no impact on the fair value and goodwill calculation.
8 Report and accounts
A copy of the Annual Report and Accounts for the Year ended 30 June 2024 will
be sent to all shareholders in due course, together with notice of the Annual
General Meeting, and will be available to view and download from the Company's
website at www.eagleeye.com (http://www.eagleeye.com) .
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