REG - Eagle Eye Solutions - H1 Trading Update and Notice of Results

Eagle Eye SolutionsAnnouncement

16/01/2024 07:00

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RNS Number : 7663Z  Eagle Eye Solutions Group PLC  16 January 2024

16 January 2024

Eagle Eye Solutions Group plc

("Eagle Eye", the "Group", or the "Company")

 

H1 Trading Update

and

Notice of Results

 

Delivering results in line with expectations and continued expansion in the US

 

Eagle Eye (LSE: "EYE"), a leading SaaS technology company that creates digital
connections enabling personalised, real-time marketing, provides an update on
the Group's trading for the six months ended 31 December 2023 (the "Period").

 

Highlights

 

                                                         H1 FY24  H1 FY23  % change
 Group Revenue                                           £24.1m   £20.0m   +20%
 Recurring revenue (subscription fees and transactions)  78%      78%       -
 Adjusted EBITDA(*)                                      £5.9m    £4.7m    +25%
 Adjusted EBITDA* margin                                 24.3%    23.5%    +0.8ppt
 Net cash at 31 December**                               £7.8m    £5.7m    +36%

 

 

 ·             Continued positive trading has delivered revenue and EBITDA growth in line
               with Eagle Eye's "Rule of 40" objective and Board expectations
 ·             The Group continues to win and expand its relationship with some of the
               world's largest retailers. Eagle Eye now has eight North American customers
               and a growing presence in Europe and Asia, alongside its long-standing UK
               customers
 ·             Successful first year for Untie Nots as part of the Group, including expansion
               with key customers and major new wins, including entry into the UK market
               through a win with Morrisons, benefitting from Eagle Eye's larger marketing
               reach and relationships
 ·             Investment in innovation to capitalise on the expanding market opportunity,
               including the creation of a new AI offering, EagleAI, launched at the world's
               largest retail trade show, NRF, in New York, last week
 ·             Awarded 7(th) place in the UK's Best Companies to Work for, and named the
               7(th) most innovative marketing technology company in the world in the TMW 100
               awards
 ·             The Board is confident in delivering another year of profitable growth in line
               with its expectations

 

The Group delivered another good performance during the Period, achieving
revenue and profit growth in line with its "Rule of 40" objective (revenue
growth + Adjusted EBITDA margin = 40+). Revenue grew 20%, to £24.1m (H1 FY23:
£20.0m) and adjusted EBITDA* increased 25% to £5.9m (H1 FY23: £4.7m),
representing an EBITDA margin of 24.3% (H1 FY23: 23.5%).

 

In line with Board expectations, reflecting seasonal flows and payment of an
element of the outstanding consideration in respect to the Untie Nots
acquisition, the Group had a net cash outflow of £1.5m in the Period (H1
FY23: £2.0m inflow), resulting in a net cash position of £7.8m at 31
December 2023 (30 June 2023: £9.3m). The Board expects the Company to be cash
generative in the second half of the financial year.

 

Eagle Eye continued to expand across its target geographies in the Period,
securing a high level of new 'Wins', with highlights including two five-year
loyalty contracts in North America, bringing Eagle Eye's total North American
customer numbers to eight, including the first win for EagleAI. Other wins
include a three-year contract with an Australian retailer, and a three-year
contract with The Ivy Collection in the UK, a popular group of brasseries and
cafes, to power its colleague discount scheme.

 

The Group's continued strong performance has been supported by the deepening
of existing relationships, delivering a continued strong level of Net Revenue
Retention. Highlights include expansion with Woolworths in Australia, Hudson's
Bay in North America, as well as Asda in the UK.

 

The Company's newly acquired business, Untie Nots, continues to perform
strongly, expanding with existing customers, including E.Leclerc, as well as
entering new territories through the strength of the Eagle Eye sales and
marketing efforts, including deepening Eagle Eye's relationship with
Morrisons, adding Untie Nots' AI-powered 'Challenges' product.

 

In the period, Eagle Eye signed a partnership agreement with commercetools, a
global leader in composable commerce headquartered in Germany, with the intent
to launch an integration-led Partnership in early 2024. This will enable
commercetools customers to access the power of the Eagle Eye AIR platform and
its associated Loyalty and Promotional capabilities on their eCommerce
websites through a single, ready-to-use connection.

 

The Group's innovative AI-offering, EagleAI, was successfully launched last
week at the world's largest retail trade show, NRF in New York and we were
delighted to announce our first customer for EagleAI last week.

 

During the Period, the Group moved up the rankings to 7th place in the UK's
Best Companies to Work for and was named the 7th most innovative marketing
technology company in the world in the recent TMW 100 awards, where it also
received the prestigious Judges Pick accolade. These are recognition of the
Group's continued embodiment of the "Golden Rule": treating people as they'd
like to be treated, which is the guiding principle behind the Group's
world-class culture.

 

Outlook

 

Retailers around the world are continuing to assess how best to provide highly
relevant, personalised promotions and loyalty offerings to their customers,
including leveraging the benefits of data science and AI. The proven ability
of Eagle Eye's AIR platform to deliver personalised promotions, in real-time,
at the scale and speed required by the world's largest retailers, continues to
drive a growing sales pipeline.

 

Supported by a scalable SaaS business model, high levels of recurring
revenues, strong margins and increasing levels of cash generation, the Board
remains confident in delivering results for FY24 in line with management
expectations.

 

 

Tim Mason, Chief Executive of Eagle Eye, said:

 

"Through the AIR platform's ability to deliver hyper personalised messages to
consumers at speed and scale, we are in a strong position to be an enabler of
the advancements taking place in the world of retail marketing. With a growing
addressable market, a newly launched AI-powered offering, EagleAI, an
outstanding team and high-quality business model driving growth in revenue,
profits, and cash generation, we are extremely excited about the future of
Eagle Eye."

 

Notice of Results

 

The Group expects to announce its results for the six months ended 31 December
2023 on Tuesday, 19 March 2024.

 

Notice of Investor event

 

Eagle Eye will be hosting an in-person presentation for investors and equity
research analysts on Thursday, 22 February 2024 in London, providing insight
into the Group's growth strategy. Should you wish to attend, please contact
eagleeye@almastrategic.com (mailto:eagleeye@almastrategic.com) . No material
new information will be provided on the day.

 

Notes:

All financials are based on unaudited figures

 

*EBITDA has been adjusted for the exclusion of share-based payment charges
along with depreciation, amortisation, interest and tax from the measure of
profit. H1 2023 EBITDA figure has also been adjusted to exclude costs
associated with the acquisition of Untie Nots.

** Net cash is defined as cash and cash equivalents less financial liabilities
and excludes placing proceeds raised associated with the consideration for the
acquisition of Untie Nots, which was paid out following completion of the
acquisition on 3 January 2023.

 

 

 For further information, please contact:

 Eagle Eye Solutions Group plc                                 Tel: 0844 824 3686

 Tim Mason, Chief Executive Officer

 Lucy Sharman-Munday, Chief Financial Officer

 Investec (Nominated Advisor and Joint Broker)                 Tel: 020 7597 5970

 Corporate Finance: David Anderson / Nick Prowting

 Shore Capital (Joint Broker)                                  Tel: 020 7408 4090

 Corporate Finance: 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 750 million
personalised offers are executed via the platform every week, and it currently
hosts over 200 million individual loyalty members for businesses all over the
world. We are 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 2023, the Group acquired France-based Untie Nots, an AI-powered
personalised promotions business, adding Carrefour, E. Leclerc, Auchan and
other leading brands to its European customer base.

 

 

Web - www.eagleeye.com (http://www.eagleeye.com/)

 

 

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