REG - Engage XR Holdings - FY2022 Trading Update and Notice of Results

ENGAGE XR HoldingsAnnouncement

18/01/2023 07:00

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RNS Number : 0377N  Engage XR Holdings PLC  18 January 2023

18 January 2023

 

ENGAGE XR Holdings Plc

("ENGAGE XR" or the "Group")

 

FY2022 Trading Update and Notice of Results

 

ENGAGE XR Holdings Plc (AIM: EXR; Euronext Growth: EXR), a leading metaverse
technology company, today issues an unaudited update on trading for the 12
months ending 31 December 2022.  The Group's preliminary results for the 12
months ended 31 December 2022 are expected to be published in April 2023.

 

Financial Highlights:

·    Total revenue for the Group is expected to be €3.9m, an increase of
63% on 2021 (2021: €2.4m)

·    ENGAGE revenue comprises 85% of total group revenue compared to 75% in
2021

·   ENGAGE revenue up 83%. 2022 ENGAGE revenue is expected to be c.€3.3m
(2022: €1.8m)

·    Gross margin 82% in 2022 (2021: 79%)

·    EBITDA loss of €5.8m (2021: €2.7m) reflecting the increased
headcount in the Group in the year

·    Net cash of €2.2m as at 31 December 2022 versus the revised
expectation of €1.9m (2021: €7.8m). This is primarily due to cash
collections in December being slightly ahead of schedule and revenue being
better than expected in December

·   Finished 2022 with an encouraging performance.  December 2022 was the
strongest ever month for the Group, with revenue in the month of €0.6m

·    Cash burn is expected to be approximately €0.4m per month during H1
2023.

 

Operational Highlights:

·   The Group continued to expand its US presence ahead of the launch of
ENGAGE Link. ENGAGE XR's sales team is now strong across USA, Europe, and
Asia, comprising 10 employees

·    US Partner VictoryXR has launched 10 'Metaversities' funded by Meta
and built on the ENGAGE platform.

·   ENGAGE Link successfully launched in November 2022 with a portfolio of
14 major launch partners, including Lenovo, KPMG US, KIA, Adtalem, and MTN
Group

·    During December 2022, the Group signed three six-figure deals with
new clients, including a Fortune 500 company, a global consulting company with
revenues in excess of €18bn, and a Canadian educational institute

·   In November, the Group signed a commercial reseller agreement for
ENGAGE with Lenovo™, one of the world's largest computer manufacturing and
smartphone companies

·    Demand for the Company's ENGAGE platform is now well established,
having grown to serve more than 190 commercial customers in the three years
since its launch in May 2019, with over 70 customers added in 2022

·   16% of contracts are now greater than €75k in value (up from 6% in
FY21), aligning to the Groups' medium-term outlook of an average contract
value in excess of €20k

 

David Whelan, CEO, ENGAGE XR, said: "2022 has been a year of substantial
revenue growth for the Group, despite the economic outlook in many other areas
of the tech sector. ENGAGE platform revenue grew by 83% in this period, and we
closed the year with our strongest-ever sales month with €0.6m of revenue in
December 2022.

 

"We continue to see increased momentum in terms of customer engagement with
our ENGAGE platform. The first few weeks of 2023 have already seen some good
contracts signed with revenue already ahead of where we were at this point
last January.  We are optimistic about our prospects for the remainder of
this year, with a strong sales pipeline in place following the launch of our
enterprise metaverse platform, ENGAGE Link, in November.

 

"We believe that ENGAGE Link has been well received, and we expect to deliver
a significant expansion of this service throughout 2023.  The sales
purchasing cycle lengthened in the second half of 2022 in some areas due to
the global economic conditions, but early signs are that this trend is easing.
We, therefore, expect to see steady growth for the first half of 2023, with
the benefits of our new Lenovo partnership announced in November expected to
be seen during the second half of 2023.

 

"Lenovo and ENGAGE will work together, bundling Lenovo hardware with ENGAGE
software licenses for large corporate clients and providing metaverse services
to those who request them. This will be an exciting time for both companies.
Our sales teams are already working together to ensure we execute on all the
opportunities and scale efficiently with a focus on the US and EU markets.

 

"During 2023, we believe that we will see the use of the metaverse by
corporations and educational institutes increase and evolve.  My vision for
ENGAGE is for it to become the dominant metaverse platform of choice for
Fortune 500 companies.  In 2022, we worked on partnerships and deals that
will further this long-term goal at the expense of closing multiple smaller
cash deals. At ENGAGE XR, we build our business relationships on strong
foundations, and I believe that this coming year is set to be a seminal one
for the Group and its prospects."

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the company's obligations under Article 17 of
MAR.

 

For further information, please contact:

 

 ENGAGE XR Holdings Plc                                      Tel: +353 87 665 6708

 David Whelan, CEO                                           info@engagexr.co

 Séamus Larrissey, CFO

 Sandra Whelan, COO

 finnCap Ltd (Nominated Adviser & Joint Broker)              Tel: +44 (0) 20 7220 0500

 Marc Milmo/ Seamus Fricker (Corporate Finance)

 Sunila de Silva (ECM)

 Shard Capital Partners LLP (Joint Broker)                   Tel: +44 (0) 20 7186 9952

 Damon Heath / Erik Woolgar

 Davy (Joint Broker & Euronext Growth Listing Sponsor)       Tel: +353 1 679 6363

 Barry Murphy / Lauren O'Sullivan

 SEC Newgate (Financial Communications)                      Tel: +44 (0)7540 106 366

 Robin Tozer / Naz Zandi                                     engage@secnewgate.co.uk

 

About ENGAGE XR

ENGAGE XR Holdings plc (AIM: EXR; Euronext Growth: EXR) is metaverse
technology company focused on becoming a leading global provider of virtual
communications solutions through its new fully featured corporate metaverse,
ENGAGE Link. A demonstration of ENGAGE Link is here
(https://www.youtube.com/watch?v=ITtz7ErWhMs&t=2s)

 

The Company also has a proprietary software platform, ENGAGE. ENGAGE provides
users with a platform for creating, sharing, and delivering VR content for
education, training, and online events through its three solutions: Virtual
Campus, Virtual Office, and Virtual Events.

 

EXR is listed on AIM in London and on the Euronext Growth Market in Dublin, a
market operated by Euronext Dublin.

 

For further information, please visit: www.engagexrholdings.com (LinkedIn:
@Engage XR Holdings plc Twitter: @engage_xr)

 

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