REG - GetBusy PLC - 2021 Audited Results
01/03/2022 07:16
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RNS Number : 1190D GetBusy PLC 01 March 2022
1 March 2022
GetBusy plc
2021 Audited Results
Strong ARR momentum with upgrade to 2022 expectations
GetBusy plc ("GetBusy", the "Company" or the "Group") (AIM: GETB), a leading
provider of productivity software for professional and financial services,
announces its audited results for the year ended 31 December 2021.
2021 2020 Change
£'000 £'000 Reported currency Constant currency(+)
Group ARR 15,828 13,680 16% 16%
Group recurring revenue 14,343 13,017 10% 13%
Group total revenue 15,448 14,179 9% 11%
Group adjusted EBITDA* (510) (369) (38)%
Group adjusted loss before tax* (1,222) (927) (32)%
Group loss before tax (2,335) (1,126) (107)%
Net cash 2,670 2,283 17%
Financial highlights
· Acceleration of constant currency ARR growth to
16% after very strong final quarter
· Recurring revenue growth of 13% at constant
currency to £14.3m (2020: £13.0m)
· Recurring revenue comprises 93% of total revenues
(2020: 92%), providing excellent visibility
· Gross margin remained strong at 91.6% (2020:
92.6%)
· Adjusted EBITDA of £(0.5)m (2020: £(0.4)m)
reflecting ongoing growth investment
· Net cash of £2.7m (2020: £2.3m) significantly
ahead of market expectations
Operational highlights
· Completed three technology acquisitions,
broadening our capabilities to drive future ARPU growth
· Annual contract value from new business up 10%
· Net revenue retention very strong at 99.8% (2020:
99.6%)
· Paying users up 9% to 73,352
· Group ARPU up 6% at constant currency to £216
· Significant progress in opening new markets, with
early successes in asset financing and ERP
· GetBusy product renamed Workiro
Upgraded expectations for 2022
· Strong ARR momentum drives 2022 group revenue of
not less than £17.0m
· Increased investment in growth and emerging
capabilities to fuel long term growth
· Adjusted EBITDA approaching break-even
Daniel Rabie, CEO of GetBusy, comments:
"2021 has been pivotal for GetBusy.
"As a result of the continued investment in the expansion of our capabilities
and product range, the Group has evolved from being a provider of document
management software for accountants to a provider of productivity software for
professional and financial services firms. This has expanded our opportunities
across a larger addressable market in which we have already begun to generate
traction, complementing the strong growth in our existing businesses.
"Macro trends, including international privacy legislation, digital
transformation, cyber security and mobility, are driving substantial demand
and creating new markets and we are well-positioned to capitalise on that
opportunity.
"We have entered the new year with encouraging momentum from our high-quality
recurring subscription revenues and we now anticipate 2022 revenue growth will
be ahead of expectations(#), enabling us to increase investment in long-term
growth across our business."
* Adjusted Profit / (Loss) before Tax is Profit / Loss before share option
costs, net capitalised development costs, finance costs that are not related
to leases, and non-underlying items. Adjusted EBITDA is Adjusted Profit /
(Loss) before Tax stated after capitalised development costs. A full list of
our alternative performance measures, together with a glossary of certain
terms, can be found in note 2.
(+) Changes at constant currency are calculated by retranslating the
comparative period at the current period's prevailing rate of exchange.
(#) Current 2022 market expectations are considered to comprise revenue of
£16.2m and Adjusted Loss before Tax of £(1.1)m.
From 2022, the Group's segmental reporting will be changed to reflect the
Group's transition to being a productivity software provider to professional
and financial services. Revenue will be reported by region while costs will
be reported on an aggregated basis.
A copy of the presentation to investors is now available on the Company's
website, at www.getbusyplc.com
GetBusy plc
investors@getbusy.com
Liberum Capital Limited (Nomad and Broker)
Cameron Duncan / Lauren
Kettle
+44 (0)20 3100 2000
Alma PR (Financial PR)
Hilary Buchanan / Andy Bryant / Hannah Campbell
+44 (0)20 3405 0205
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF
THE MARKET ABUSE REGULATION (EU) 596/2014. THE PERSON RESPONSIBLE FOR MAKING
THIS ANNOUNCEMENT ON BEHALF OF THE COMPANY IS PAUL HAWORTH.
About GetBusy
GetBusy's specialist productivity software solutions enable growing businesses
to work securely and efficiently with their customers, suppliers and teams
anytime, anywhere. Our solutions can be delivered flexibly across cloud,
mobile, hosted and on-premise platforms, whilst integrating seamlessly with a
wide variety of other class-leading core business systems.
With over 70,000 paying users across multiple market sectors and
jurisdictions, GetBusy is an established and fast-growing SaaS business
delivering sustained double-digit growth in high-quality recurring
subscription revenue over the long term.
Further information on the Group is available at www.getbusyplc.com
Chairman's Statement
2021 has been a year of considerable financial and strategic progress, with
accelerating ARR, strong cash generation and a marked broadening of our
capabilities.
The Group has transitioned from being a provider of document management
software for accountants to a provider of productivity software for
professional and financial services firms. Through continued investment in the
expansion of our capabilities and product range, we have enlarged our
addressable market and started to generate early traction in those new
markets; our future reporting will reflect this.
I would like to take the opportunity to thank each member of our excellent
teams in Cambridge, Houston and Sydney. Through another year of global
turmoil and personal challenges, you have supported each other, shown grit and
professionalism and delivered an excellent set of results. Because of you, the
business has never been in better shape, with strong foundations and greater
opportunity than ever for substantial long-term growth. On behalf of the
board, thank you.
We are proud that our products equip our customers to move away from
paper-based processes, reducing waste and eradicating the carbon associated
with transporting, storing and destroying paper records. We strive to ensure
our own operations are as benign as possible for the environment, including
adopting repurposed industrial buildings for our main offices. As a cloud
software business, we are excited to be working with Amazon Web Services and
their new toolset to monitor and reduce the carbon footprint of our services,
and we look forward to transitioning to fully renewable energy for our cloud
services by 2025.
Looking ahead, the Group remains committed to investment to generate
substantial long-term value through sustained double-digit growth in
high-quality recurring subscription revenue. Our broadening capabilities
address high-value challenges in attractive markets driven by favourable
tailwinds. We are confident we have the right strategy and management team to
deliver considerable long-term growth.
GetBusy enters 2022 in excellent shape, well-positioned for an acceleration of
recurring revenue growth. The foundations from which to scale the business
are in place and the Group's growing capabilities provide more opportunity
than ever to capture an increasing share of very attractive markets. The
opportunity is considerable.
CEO's Review - significant strategic progress and effective execution
Introduction
The Group delivered a strong financial performance in 2021 coupled with
substantial strategic progress, including expansion into the asset finance
market with a new product, three technology acquisitions to broaden our
capabilities and a significantly expanded opportunity. Demand from new
customers was buoyant across our target markets and customer retention was
high, resulting in double-digit revenue growth, cash materially ahead of
expectations and 16% growth in ARR, providing improved visibility.
Nearly five years on from our IPO, the Group has doubled in size. We have
never had a firmer foundation from which to embark upon our ambition to at
least double again within the next five years.
Current trading and outlook
During 2021 the Group continued to expand its product portfolio, both through
internal development and acquisition, to capture the substantial market
opportunity available. As the working world becomes more complex there is a
growing requirement for organisations to adopt digital mobility and
interoperability whilst operating within strict legislative and compliance
frameworks and at the same time balancing the need to protect against emerging
cyber threats. Growing businesses need GetBusy's specialist productivity
software solutions to enable them to work securely and efficiently with their
customers, suppliers and teams anytime, anywhere.
Our software suite now includes a range of tools and end-to-end workflows such
as digital asset and document management, tailored templates, quotes/proposal
development, form-fill, authentication, e-signatures and approvals, workflow
and task management, chat, and complex digital certification.
These solutions can be delivered flexibly across cloud, mobile, hosted and
on-premise platforms, whilst integrating seamlessly with a wide variety of
other class-leading core business systems, such as ERP, accounting, tax,
policy management and insolvency practice management systems.
As a result, we enter 2022 with product capabilities which substantially
improve our position to deliver on our overarching strategic objective: to
create value by generating long-term growth in high-quality, predictable
recurring subscription revenue through our growing range of productivity
software applications.
The strong ARR momentum from 2021 has carried on into the start of 2022 and
provides the platform for us to deliver further significant revenue growth in
the current financial year. We are increasingly confident that our solutions
are solving key challenges for our clients and that our wider global market
opportunity is growing, underpinned by a number of long-term drivers. This,
together with the planned launch of new solutions into both existing and new
markets in the year ahead, gives us growing confidence to continue to invest
in our business and deliver high growth in revenues in FY22 and beyond.
Business review
GetBusy is a leader in productivity software for professional and financial
services, used and valued globally, including by over 30% of the UK's largest
professional firms. These attractive markets benefit from compelling growth
drivers on which we can capitalise over the long term with our growing
capabilities, talented and ambitious team and our scalable, predictable SaaS
business model. SaaS models produce reliable recurring revenue streams and
upfront cash that provide outstanding visibility to invest for growth with
confidence. The very attractive gross margins lead to highly cash generative
and profitable businesses as scale is achieved.
Market opportunity
Our evolution in 2021 from being a provider of document management software
for accountants to a provider of productivity software for professional and
financial services firms is a very important shift for GetBusy.
Through our sustained investment in product development, and carefully
selected technology acquisitions, our capabilities have broadened to address
more of the productivity challenges faced by professionals as they initiate,
manage and complete work with their colleagues and clients. These
developments, such as automated document requests, e-mail capture and digital
proposals, deliver greater value to our customers, improving security and
freeing up valuable client-facing time, driving our ability to expand further
into our client base.
This broadening capability set gives us the opportunity to enlarge
substantially our target market, moving into adjacent industries that have
analogous workflows to accountants and to which we can add similar value. We
have already generated momentum within the cyclically buoyant insolvency
market and seen early success in the asset finance market with our new
Certified Vault product.
Based on employment numbers within our countries of operation, we estimate the
accounting and bookkeeping sector presents an ARR opportunity in excess of
£750 million, while financial services is in excess of £1 billion. We
estimate the market for Workiro within the cloud ERP market is in excess of
£1 billion, based on published customer numbers from the key cloud-ERP
providers.
Our target markets share four compelling and enduring growth drivers.
· Digital transformation. Operational efficiency is a key lever to
maintain profitability in professional and financial firms, driving
demand for innovative, integrated software applications to simplify and
speed-up complex admin tasks.
· Legislation. Our software helps businesses comply with the
global proliferation of privacy legislation.
· Cyber security. We help businesses secure some of their most
sensitive and valuable data and documents.
· Mobility and hybrid working. We help professionals work securely
and efficiently anytime, anywhere.
The strong operational performance in 2021 and our financial position has
given us a firm foundation to invest in order to capitalise on these market
tailwinds, propelling our ambitions to at least double ARR within five
years.
Effective execution of strategy
The highlight of 2021 was the acceleration of our ARR growth rate to 16%, with
ARR at 31 December of £15.8m (2020: £13.7m). This reflects effective
execution in a number of areas:
· New business and new markets. Each of our businesses
generated more new business than in 2020, with overall new business growth of
10%. Our core accounting market was the main driver of growth, augmented by
significant client wins among insolvency practitioners, a market in which we
now have a very firm foothold. Encouragingly, we have also gained initial
traction in the asset finance and ERP markets - both of which represent
similar growth opportunities to the accounting market.
· Customer retention. Our ongoing commitment to
investing in the user experience and capabilities of our products is aimed at
keeping customers engaged and with us longer, leading to consistently high
retention rates - our gross revenue churn rate averaged 1.0% across the Group
(2020: 0.9%) - and attractive customer lifetime values.
· Monetisation. The effective pricing and packaging of
our products will contribute towards us narrowing the gap between new customer
pricing and the average price paid across the base. In 2021 our monetisation
programmes delivered at the top end of our expectations.
· Expansion. Upselling additional capabilities into our
customer base has been proven in the Group and will be an important part of
our future growth. These capabilities, developed in-house or acquired, also
help us to open new markets.
The growth opportunity available to us is substantial. Our focus remains the
effective execution of all four of these revenue growth drivers.
Financial review
Group 2021 2020 Change
Reported currency Constant currency
ARR at 31 December £15,828k £13,680k 16% 16%
Recurring revenue £14,343k £13,017k 10% 13%
Total revenue £15,448k £14,179k 9% 11%
Adjusted EBITDA £(510)k £(369)k (38)%
Adjusted profit / (loss) £(1,222)k £(927)k (32)%
Paying users at 31 December 73,352 67,343 9%
ARPU at 31 December £216 £203 6% 6%
Net revenue retention 99.8% 99.6% n/a
Revenue
ARR grew by 16% to £15.8m (2020: £13.7m), driven by new business and the
favourable impact of our monetisation strategy.
Annual contract value ("ACV") from new business was £2.4m, up 10% compared to
2020 at constant currency; each of the Group's businesses reported growth in
new ACV, with particular strength in SmartVault. This reflects the ongoing
demand for our productivity solutions and the enduring nature of the core
drivers of the professional and financial services markets in which the Group
operates.
Net revenue retention, a measure of the proportion of recurring revenue
retained from month-to-month, was very strong at 99.8% (2020: 99.6%).
Together with consistently buoyant customer retention rates, this is driven by
our monetisation strategy and its favourable impact on ARPU across the
customer base during the final quarter of the year. We expect to see
continued ARPU improvements from this strategy during the course of 2022, with
ARPU gains thereafter driven by expansion revenue from uptake of our
broadening productivity capabilities.
Reported recurring revenue was up 13% to £14.3m (2020: £13.0m), representing
93% (2020: 92%) of total revenue. As with ARR, recurring revenue growth was
strongest in SmartVault at 26%, with Virtual Cabinet achieving 4% growth.
Non-recurring revenue was down 5% to £1.1m, reflecting Virtual Cabinet's
revenue model transition from upfront, perpetual licences to higher value
recurring subscriptions, offset by growth in SmartVault as the user base
expands. Total revenue of £15.4m (2020: £14.2m) was up 11% at constant
currency.
Gross margin and overheads
Gross margin of 91.6% (2020: 92.6%) reflects the growth in our full cloud
solutions, for which we bear the ongoing platform costs, and a greater uptake
of SmartVault's integrated digital signature solution, for which there is an
incremental cost of sale. Future gross margins will reflect the increasing
proportion of the Group's revenue from our cloud solutions.
Our long-term growth will be underpinned by continued investment to broaden
our capabilities, solving more productivity challenges for our customers and
enabling us to move into adjacent industries, expanding our addressable
market. An example of this is Certified Vault, built on our foundational
SmartVault platform, which opens the substantial asset financing market to the
Group.
Throughout 2021 we have continued our strategic investments in long term
growth. Developer costs before capitalisation increased by 6% to £3.8m
(2020: £3.6m); we are planning further investment in our product development
capabilities over the course of 2022. Sales, general and admin costs were up
10% to £11.6m (2020: £10.5m), due to a combination of investments in
customer acquisition, to drive new business, customer success, to drive net
revenue retention, and performance incentives.
Adjusted EBITDA in 2021 was £(0.5)m (2020: £(0.4)m) while adjusted Loss
before Tax was £(1.2)m (2020: £(0.9)m). Statutory loss after tax was
£(1.6)m (2020: profit of £0.4m).
Cash
Our revenue model benefits from a high proportion of subscriptions paid
annually in advance, with the final quarter of the year being particularly
cash generative. Together with the receipt of UK research and development
tax credits, this favourable cashflow dynamic allows us to continue our
investments in long-term growth. Net cashflow in 2021 was strong at £0.5m
(2021: £0.4m), supported additionally by the working capital seasonality of
our performance incentive programmes, with closing net cash of £2.7m (2020:
£2.3m), up 17% over the year. Our £2million revolving credit facility with
Silicon Valley Bank remains fully undrawn and, together with our strong cash
balance, provides us with considerable confidence and cash headroom as we
continue to invest in future growth.
SmartVault
SmartVault 2021 2020 Change
Reported currency Constant currency
ARR at 31 December £7,854k £5,835k 35% 33%
Recurring revenue £6,439k £5,433k 19% 26%
Total revenue £6,818k £5,700k 20% 28%
Adjusted Profit / (Loss) £(1,020)k £(1,373)k 26%
Paying users at 31 December 28,499 23,530 21%
ARPU at 31 December £276 £248 10% 11%
Net revenue retention 100.0% 99.2% n/a
SmartVault new business ACV of £1.9m was up 12% on 2020 and benefitted from
an increase in the average selling price, driven by larger account sizes.
This move towards larger accounts, and the introduction of a minimum user
number, is part of a drive to improve our customer acquisition efficiency and
improve customer retention rates, since generally larger accounts have lower
churn rates. The introduction of the Certified Vault product, which caters
to the financial services market, has also contributed to the increase in
average selling price, with new ACV being typically 4 to 5 times larger than
for a traditional SmartVault customer. Customer acquisition efficiency
remains strong, with an average LTV : CAC ratio of 4:1 (2020: 4:1) despite
expansion into the asset finance market.
Net revenue retention of 100.0% was a marked improvement on 2020 (99.2%).
This reflects the very favourable impact from our monetisation strategy, which
launched in November and contributed c. £0.9m in ARR. Gross churn of 1.4%
per month (2020: 1.2%) continues to be markedly better than is typical in the
SME space, with the slight increase compared to 2020 being a result of the
expected impact of our monetisation strategy on certain customer cohorts.
Overall recurring revenue was 26% higher at £6.4m (2020: £5.4m); the growth
rate was lower than that for ARR as the substantial uplift from monetisation
did not impact until the final quarter of the year. Total revenue was £6.8m
(2020: £5.7m), up 28%, and benefitted from a higher uptake of services and
our other non-recurring add-on products.
Gross margin of 84% (2020: 85%) reflects the higher uptake of our integrated
digital signature solution, for which there is a cost of sale.
The 8% increase in overheads to £6.8m is the result of our investments to
scale the business, specifically in the customer acquisition, customer success
and product development teams, reflecting our strategy of generating long term
growth in high quality recurring subscription revenue. This led to Adjusted
Loss of £(1.0)m (2020: £(1.4)m).
Virtual Cabinet
Virtual Cabinet 2021 2020 Change
Reported currency Constant currency
ARR at 31 December £7,944k £7,854k 1% 2%
Recurring revenue £7,881k £7,578k 4% 4%
Total revenue £8,607k £8,473k 2% 1%
Adjusted Profit / (Loss) £4,370k £3,891k 12%
Paying users at 31 December 44,594 43,631 2%
ARPU at 31 December £178 £180 (1)% 0%
Net revenue retention 99.7% 99.8% n/a
Recurring revenue in Virtual Cabinet remained solid during 2021, growing at 4%
at constant currency to £7.9m (2020: £7.6m) while ARR was 2% up at £7.9m
(2020: £7.9m), generating very reliable and predictable cashflow. New
business was particularly strong in the insolvency sector, in which we have
strong integration with the leading practice management software. As well as
the cyclical buoyancy of that sector, there is opportunity arising from the
decision by many larger accounting firms to spin off their restructuring
practices to address independence challenges, requiring some of the
newly-created firms to rebuild their technology stacks from scratch.
Upgrades to existing customers, which includes additional users, also
contributed meaningfully, especially in H2, albeit typically at a lower ARPU.
Non-recurring revenue, which includes consulting and upfront licence sales,
decreased by 19% to £0.7m, a reflection of the transition to a pure
subscription model that was started 4 years ago. Total revenue was £8.6m
(2020: £8.5m).
Virtual Cabinet's overheads remain tightly controlled and were 8% lower than
2020, a product of lower bad debt and office rent costs offset by higher
marketing spend and inflationary staff costs.
Adjusted profit of £4.4m was up 12% compared to 2020 and operating profit
margin improved by 4.9 percentage points to 50.8%.
Workiro
Workiro 2021 2020 Change
Total revenue £31k £6k 437%
Adjusted Profit / (Loss) £(2,037)k £(1,975)k (3)%
ARR at 31 December £66k £17k 288%
Paying users at 31 December 556 182 205%
ARPU at 31 December £94 £81 16%
Workiro is the new name for the GetBusy product. Workiro serves the dual
purpose of opening the valuable cloud-ERP market to the Group as well as
providing product capabilities and expansion revenue opportunities for our
other businesses.
During 2021 we redirected the efforts of the team towards the cloud ERP
sector, seeking to capitalise on our partnership with NetSuite. The cloud
ERP space is estimated to be growing at 17% annually, with innovative products
like NetSuite, Sage Intacct and Acumatica taking market share from the
traditional on-premise ERP providers. The ERP sector has many of the
attractive hallmarks of the accounting practice management space into which
our document management products are sold: the technology is infrastructural
to the customer's business, customers tend not be price-sensitive, solutions
tend to remain in place for many years and churn rates are low.
The ecosystem around cloud ERP providers presents us with an interesting
opportunity. Most providers curate a suite of third party add-on
applications that address peripheral functionality, enhance the user
experience within the core ERP product or tailor the product for particular
industries. These applications are available for existing users to purchase
in app stores. Networks of value-added resellers and consulting firms work
with individual customers to design, implement and customise their technology
stack around specific ERP systems; these resellers look for opportunities to
sell additional capabilities into their existing clients.
Our immediate opportunity with NetSuite customers comes from a combination of
working directly with NetSuite and with the value-added reseller network.
Workiro integrates into the primary NetSuite interface and provides powerful
document management, digital signature, real-time chat and task capabilities
embedded within the application. Documents can be assigned to customer or
supplier records and then sent into managed workflows via Workiro, for example
to obtain a signature on a new contract with a customer or to send an invoice
from a supplier to a quality assurance team for review, enabling them to
attach certificates of conformity neatly into one thread. Whilst elements of
this functionality are available from other applications within NetSuite's
SuiteApp store, none of them provides this integrated experience and the
combined cost of those applications far exceeds that of the single Workiro
solution.
The Workiro technology provides benefits to the broader Group. For example,
it provides an alternative portal for certain customers of Virtual Cabinet and
will also form a component of its future cloud strategy. The core task,
signature and novel document capabilities have the potential to add value to
the Group's other products.
2021's activities have been targeted towards gaining visibility and
credibility within the NetSuite and broader ERP ecosystem, collecting feedback
on our solution and iterating it accordingly. Key to this has been
establishing commercial relationships with value-added resellers, who
typically have dozens of installed customers, each of which may comprise many
hundreds of users.
We are encouraged by the progress so far, whilst acknowledging that
uncertainties remain to generating meaningful traction. Our solution clearly
resonates with resellers and their customer base, solving real problems that
impact productivity across enterprises. The resellers we have signed are
introducing us into their sales processes for new customers and into project
plans for reconfigurations and maintenance for existing customers. The early
ERP customers we have onboarded are seeing clear value in the integrated
product offering and we expect them ultimately to reflect the high retention
rates that are typically seen across the ERP space.
Sales cycles are typically longer than, for example, our transactional
SmartVault business, reflecting the magnitude and complexity of ERP projects
for large enterprises. To counter this, we are adding resellers with a
variety of industry specialisms and a breadth of client size.
Revenue of £31k (2020: £6k) reflects the initial traction to £66k of ARR,
including £39k from cross-selling into the Group's existing channels.
Costs in 2021 were largely at the same runrate as in 2020.
Central and corporate costs
Central and corporate costs comprise the costs of certain centralised
functions, such as finance, people and culture, and IT and security
operations, together with the costs of the board and those associated with
being a public company.
The increase in corporate costs to £2.5m (2020: £1.5m) largely reflects the
higher accrual for performance bonuses, together with investments in the
people and culture function to support the recruitment, retention and
development of our global team as we scale.
Items reconciling Adjusted Loss with Loss before Tax
On an IFRS basis, we have capitalised £0.7m of development costs in 2021
(2020: £0.6m), which relates solely to work carried out on Virtual Cabinet
and SmartVault. Capitalised amounts in 2021 relate to, amongst other things,
the development of Certified Vault, our RequestDocs and Email Capture
features, integration of SmartVault with a 3rd party billing system, which
will support expansion and monetisation efforts within SmartVault in the
future, and substantial user interface improvements in Virtual Cabinet. No
costs related to the development of Workiro have been capitalised as there is
insufficient certainty over the commercial viability of that product at this
stage.
The increase in depreciation on owned assets and amortisation is due to the
impact of continued capitalisation of development costs and the opening of our
new offices in Cambridge and Houston.
Share option costs remained at £0.7m (2020: £0.7m) and reflect both the
IFRS2 charge on the options granted and the increase in the provision for
employment taxes due if options are exercised.
Non-underlying costs of £0.4m (2020: £0.1m) comprise restructuring and
redundancy costs together with a £0.3m provision for potential historic sales
tax liabilities in certain jurisdictions in the US.
Other income in 2020 related to the full forgiveness of the Paycheck
Protection Program loan that we received in the US (£0.4m) and the income
credit for the "RDEC" portion of our 2017 UK research and development tax
claim. There were no such items in 2021.
The loss before tax for the year was £2.3m, an increase of 103% compared to
2020, largely a result of the one-off other income in 2020, together with
higher non-underlying costs and a higher adjusted loss before tax.
Tax
The tax credit of £0.8m (2020: credit of £1.5m) reflects the expected UK
research and development tax credit offset by overseas tax payable in
Australia and New Zealand. The Group still has sizeable carried forward tax
losses in the UK and US.
Profit / (loss) after tax
The Group recorded a loss after tax of £1.6m (2020: profit of £0.4m).
Cashflow and working capital
A number of items have contributed to the net cash inflow of £0.4m in 2021,
which has been achieved despite the Adjusted Loss before Tax of £(1.2)m and
capital expenditure of £0.3m:
· Deferred revenue increased by £0.8m as a result of the continued
ARR growth and the large proportion of our new business that is paid annually
in advance;
· Trade and other payables increased by £1.1m, largely due to
higher accruals for performance incentives;
· £0.7m was received in the UK from research and development tax
credits in respect of 2020.
Net cash at 31 December 2021 was £2.7m, an increase of £0.4m from 31
December 2021. The £2m revolving credit facility has remained entirely
undrawn during the year.
Balance sheet
The £0.3m increase in intangible assets in 2021 to £1.1m is a result of an
excess of capitalised development costs over the related amortisation,
together with purchased software, including the technology acquisitions of
Plann3r, DocDown and Quoters, and related implementation costs. Capitalised
development costs relate solely to the Virtual Cabinet and SmartVault products
In early 2021 we completed the fit-out of the US office, leading to a small
increase in property, plant and equipment to £0.4m. The reduction in right
of use assets, which relate entirely to office leases, is a result of the
amortisation of existing lease assets.
Trade and other receivables increased by £0.1m to £1.9m as a result of an
increase in prepayments. The current tax receivable of £1.0m relates to the
UK research and development tax credit due for the 2021 financial year, with
£0.4m of tax payable or refundable in the UK, Australia and New Zealand,
which is recorded within current liabilities.
The £1.3m increase in trade and other payables is chiefly the result of
higher accruals for performance incentives and sales commissions, together
with an increase in the accrual for employer taxes on share options. The
performance incentives and sales commissions are payable during H1 2022,
whereas employer taxes on share options only becomes payable on the exercise
of the related options.
Deferred revenue, which is mostly derived from annual subscriptions paid in
advance has increased by £0.8m to £5.5m as the proportion of our customer
paying annually in advance increases.
The lease liability of £1.9m relates to our Cambridge and Houston office
premises.
Over the course of 2021, 154,647 new shares were issued as a result of the
exercise of share options.
Note on future segmental reporting
During 2021, a significant shift in the Group occurred, broadening from being
a document management software group, selling to accountants, to a
productivity software group selling across professional and financial
services. The technology acquisitions of the software assets of Plann3r,
DocDown and Quoters underscore that, as does the launch and initial success of
Certified Vault and the pivot of Workiro towards the ERP space.
As the Group's new capabilities mature and become integrated with our other
applications, we expect significantly more cross-selling between products in
support of our expansion strategy. The once-distinct boundaries between our
products are becoming increasingly blurred as our customers buy richer feature
and solution sets. This is reflected in the way the Group is organised and
managed and, from January 2022, in the information reviewed by the Board to
allocate resources and monitor performance.
From 2022, our segmental reporting will reflect this revised reporting to the
Board, in accordance with IFRS8 Operating Segments. Revenue will be reported
by region, while costs will be reported on an aggregated basis.
CONSOLIDATED INCOME STATEMENT
2021 2020
£'000 £'000
Revenue 15,448 14,179
Cost of sales (1,295) (1,044)
Gross profit 14,153 13,135
Operating costs (16,355) (14,783)
Other income - 588
Net finance costs (133) (66)
Loss before tax (2,335) (1,126)
Loss before tax (2,335) (1,126)
Depreciation and amortisation on owned assets 706 558
Share option costs 400 416
Social security costs on share options 267 236
Non-underlying costs 400 126
Other income - (588)
Finance income / (costs) not related to leases 52 9
Adjusted EBITDA (510) (369)
Capitalised development costs (712) (558)
Adjusted loss before tax (1,222) (927)
Tax 771 1,524
(Loss)/Profit for the period attributable to owners of the Company (1,564) 398
(Loss)/Profit per share (pence)
Basic (3.16)p 0.81p
Diluted (3.16)p 0.71p
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
2021 2020
£'000 £'000
Profit/(Loss) for the period (1,564) 398
Other comprehensive income / (expense)
Items that may be reclassified subsequently to profit or loss
Exchange differences on translation of foreign operations (17) 92
Other comprehensive income net of tax (17) 92
Total comprehensive income for the period (1,581) 490
CONSOLIDATED BALANCE SHEET
2021 2020
£'000 £'000
Non-current assets
Intangible assets 1,110 807
Right of use assets - leases 1,544 1,842
Property, plant and equipment 426 375
3,080 3,024
Current assets
Trade and other receivables 1,907 1,815
Current tax receivable 1,021 763
Cash and bank balances 2,670 2,283
5,598 4,861
Total assets 8,678 7,885
Current liabilities
Trade and other payables (3,917) (2,614)
Deferred revenue (5,469) (4,608)
Lease liabilities (333) (263)
Current tax payable (378) (272)
(10,097) (7,757)
Non-current liabilities
Deferred revenue (4) (58)
Lease liabilities (1,533) (1,845)
(1,537) (1,903)
Total liabilities (11,634) (9,660)
Net assets (2,956) (1,775)
Equity
Share capital 74 74
Share premium account 3,018 3,018
Demerger reserve (3,085) (3,085)
Retained earnings (2,963) (1,782)
Equity attributable to shareholders of the parent (2,956) (1,775)
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2021
Share premium account
Share capital Demerger Retained earnings
Reserve Total
2021 £'000 £'000 £'000 £'000 £'000
At 1 January 2021 74 3,018 (3,085) (1,782) (1,775)
Loss for the period - - - (1,564) (1,564)
Exchange differences on translation of foreign operations, net of tax - - - (17) (17)
Total comprehensive loss attributable to equity holders of the parent - - - (1,581) (1,581)
Share option costs - - - 400 400
Total transactions with owners of the Company - - - 400 400
At 31 December 2021 74 3,018 (3,085) (2,963) (2,956)
Share premium account
Share capital Demerger Retained earnings
Reserve Total
2020 £'000 £'000 £'000 £'000 £'000
At 1 January 2020 as originally stated 73 2,756 (3,085) (2,688) (2,944)
Profit for the period - - - 398 398
Exchange differences on translation of foreign operations, net of tax - - - 92 92
Total comprehensive loss attributable to equity holders of the parent - - - 490 490
Issue of ordinary shares 1 262 - - 263
Total transactions with owners of the Company 1 262 - - 263
Share option costs - - - 416 416
- - - 416 416
At 31 December 2020 74 3,018 (3,085) (1,782) (1,775)
CONSOLIDATED CASH FLOW STATEMENT
For the year ended 31 December 2021
2021 2020
£'000 £'000
Adjusted loss before tax (1,222) (927)
Depreciation of right of use asset - leases 316 365
Income statement cost of interest on finance leases 81 56
(Increase) in receivables (92) (239)
Increase/(Decrease) in payables 1,093 (37)
Increase in deferred income 806 233
Cash used in operations 982 (549)
Non-underlying costs (400) -
Income taxes received 623 1,076
Interest (paid)/received (52) 5
Net cash used in operating activities 1,153 532
Purchases of property, plant and equipment (181) (368)
Purchases of intangible assets (163) (29)
Net cash used in investing activities (344) (397)
Principal portion of lease payments (261) (226)
Interest on lease liabilities (81) (56)
Proceeds on issue of shares - 263
Income from forgiven PPP loan - 384
Transaction costs related to loans and borrowings - (94)
Net cash used in financing activities (342) 271
Net increase in cash 467 406
Cash and bank balances at beginning of period 2,283 1,743
Effects of foreign exchange rates (80) 134
Cash and bank balances at end of period 2,670 2,283
Notes to the financial information
1. General information
GetBusy plc is a public limited company ("Company") and is incorporated in
England under the Companies Act 2006. The company's shares are traded on the
Alternative Investment Market ("AIM"). The Company's registered office is
Suite 8, The Works, Unity Campus, Pampisford, Cambridge, CB22 3FT. The
Company is a holding company for a group of companies ("Group") whose document
management and task management software enables over 70,000 professional
paying users around the world to digitise their operations and be productive
while working in the office or remotely.
These financial statements are presented in pounds sterling because that is
the currency of the primary economic environment in which the Group operates.
2. Basis of preparation and accounting policies
The financial information set out above does not constitute statutory accounts
within the meaning of section s434(3) of the Companies Act 2006 or contain
sufficient information to comply with the disclosure requirements of UK
adopted International Accounting Standards ("IFRS").
The financial statements of GetBusy plc for the year ended 31 December 2021
were authorised for issue by the Board of Directors on 28 February 2022. The
auditors have reported on these accounts and their reports were unqualified,
did not draw attention to any matters by way of emphasis and did not contain
any statements under s498 (2) or (3) of the Companies Act 2006.
Alternative performance measures
The Group uses a series of non-IFRS alternative performance measures ("APMs")
in its narrative and financial reporting. These measures are used because we
believe they provide additional insight into the performance of the Group and
are complementary to our IFRS performance measures. This belief is supported
by the discussions that we have on a regular basis with a wide variety of
stakeholders, including shareholders, staff and advisers.
The APMs used by the Group, their definition and the reasons for using them,
are provided below:
Recurring revenue. This includes revenue from software subscriptions and
support contracts. A key part of our strategy is to grow our high-quality
recurring revenue base. Reporting recurring revenue allows shareholders to
assess our progress in executing our strategy.
Adjusted Profit / Loss before Tax. This is calculated as profit / loss
before tax and before certain items, which are listed below along with an
explanation as to why they are excluded:
Depreciation and amortisation of owned assets. These non-cash charges to the
income statement are subject to significant judgement. Excluding them from
this measure removes the impact of that judgement and provides a measure of
profit that is more closely aligned with operating cashflow. Only
depreciation on owned assets is excluded; depreciation on leased assets
remains a component of adjusted profit / loss because, combined with interest
expense on lease liabilities, it is a proxy for the cash cost of the leases.
Share option costs. Significant judgement is applied in calculating the fair
value of share options and subsequent charge to the income statement, which
has no cash impact. The impact of potentially dilutive share options is also
considered in diluted earnings per share. Therefore, excluding share option
costs from Adjusted Profit / Loss before Tax removes the impact of that
judgement and provides a measure of profit that is more closely aligned with
cashflow.
Capitalised development costs. There is a very broad range of approaches
across companies in applying IAS38 Intangible assets in their financial
statements. There are also many examples of companies being criticised for
using the capitalisation and amortisation of development costs as a method of
manipulating profit, due to the substantial management judgement involved in
applying the standard. To assist transparency, we exclude the impact of
capitalising development costs from Adjusted Profit / Loss before Tax in order
that shareholders can more easily determine the performance of the business
before the application of that significant judgement. The impact of
development cost capitalisation is recorded within operating costs. The
cashflow statement reconciles from Adjusted Profit / Loss before Tax, and so
there is no adjustment for development amortisation within operating cashflows
and no adjustment for development capitalisation within cashflows from
investing activities.
Non-underlying costs. Occasionally, we incur costs that are not
representative of the underlying performance of the business. In such
instances, those costs may be excluded from Adjusted Profit / Loss before Tax
and recorded separately. In all cases, a full description of their nature is
provided.
Other income. This is income that is derived from activities outside of the
underlying business and which is generally one-off in nature. In 2020 this
included the forgiveness of a loan granted under the US Paycheck Protection
Programme and notional income received under the UK Research and Development
Expenditure Credit scheme.
Finance costs / (income) not related to leases. These are finance costs and
income such as interest on bank balances. It excludes the interest expense
on lease liabilities under IFRS16 because, combined with depreciation on
leased assets, it is a proxy for the cash cost of the leases.
Adjusted EBITDA. This is calculated as Adjusted Profit / Loss before Tax
with capitalised development costs added back.
Constant currency measures. As a Group that operates in different
territories, we also measure our revenue performance before the impact of
changes in exchange rates.
Glossary of terms
The following terms are used within these financial statements:
MRR. Monthly recurring revenue. That is, the monthly value of subscription
and support revenue, both of which are classified as recurring revenue.
ARR. Annualised MRR. For a given month, the MRR multiplied by 12.
CAC. Customer acquisition cost. This is the average cost to acquire a
customer account, including the costs of marketing staff, content, advertising
and other campaign costs, sales staff and commissions.
LTV. Lifetime value, calculated as the average revenue per account
multiplied by the average gross margin and divided by gross MRR churn.
MRR churn. The average percentage of MRR lost in a month due to customers
leaving our platforms.
Net revenue retention. The average percentage retained after a month due to
the combined impact of customers leaving our platforms, customers upgrading or
downgrading their accounts and price increases or reductions.
ARPU. Annualised MRR per paid user at a point in time.
3. Revenue and operating segments
The Group's operating segments comprise its three software products (Virtual
Cabinet, SmartVault and Workiro) and a corporate and central segment. The
Board assesses Group performance and determines the allocation of resources on
that basis.
2021 Virtual Corporate & central
SmartVault Cabinet Workiro £'000 Total
£'000 £'000 £'000 £'000
Recurring revenue 6,439 7,881 31 (8) 14,343
Non-recurring revenue 379 726 - - 1,105
Revenue from contracts with customers 6,818 8,607 31 (8) 15,448
Cost of sales (1,082) (161) (60) 8 (1,295)
Gross profit 5,736 8,446 (29) - 14,153
Sales, general and admin costs (4,987) (3,292) (774) (2,535) (11,588)
Development costs (1,769) (784) (1,23) - (3,787)
Adjusted profit / (loss) before tax (1,020) 4,370 (2,037) (2,535) (1,222)
Capitalisation of development costs 712
Adjusted EBITDA (510)
Depreciation and amortisation on owned assets (706)
Share option costs (400)
Social security on share option costs (267)
Non-underlying costs (400)
Other finance costs (52)
Loss before tax (2,335)
2020 Virtual Corporate & central
SmartVault Cabinet Workiro £'000 Total
£'000 £'000 £'000 £'000
Recurring revenue 5,433 7,578 6 - 13,017
Non-recurring revenue 267 895 - - 1,162
Revenue from contracts with customers 5,700 8,473 6 - 14,179
Cost of sales (838) (168) (38) - (1,044)
Gross profit 4,862 8,305 (32) - 13,135
Sales, general and admin costs (4,550) (3,422) (1,058) (1,470) (10,500)
Development costs (1,685) (992) (885) - (3,562)
Adjusted profit / (loss) before tax (1,373) 3,891 (1,975) (1,470) (927)
Capitalisation of development costs 558
Adjusted EBITDA (369)
Depreciation and amortisation on owned assets (558)
Share option costs (416)
Social security on share option costs (236)
Non-underlying costs (126)
Other income 588
Other finance costs (9)
Loss before tax (1,126)
Recurring revenue is defined as revenue from subscription and support
contracts. Non-recurring revenue is defined as all other revenue. No
customer represented more than 10% of revenue in either period.
Revenue by territory of operation is shown below.
2021 UK USA Aus / NZ Total
£'000 £'000 £'000 £'000
Recurring revenue 6,280 6,119 1,944 14,343
Non-recurring revenue 661 365 79 1,105
Revenue from contracts with customers 6,941 6,484 2,023 15,448
2020 UK USA Aus / NZ Total
£'000 £'000 £'000 £'000
Recurring revenue 5,880 5,211 1,926 13,017
Non-recurring revenue 822 256 84 1,162
Revenue from contracts with customers 6,702 5,467 2,010 14,179
4. Earnings / (loss) per share
The calculation of earnings / (loss) per share is based on the loss for the
period of (£1,564k) (2020: profit of £398k).
Weighted number of shares calculation 2021 2020
'000 '000
Weighted average number of ordinary shares 49,516 49,219
Effect of potentially dilutive share options in issue n/a 7,251
Weighted average number of ordinary shares (diluted) n/a 56,470
Earnings / (Loss) per share 2021 2019
Pence pence
Basic (3.16) 0.81
Diluted n/a 0.71
At 31 December 2021, there were 7,527,629 shares under option. As required
by IAS33 (Earnings per Share), the impact of potentially dilutive options was
disregarded for the purposes of calculating diluted loss per share in the
current year as the Group was loss making.
5. Reconciliation of Alternative Performance Measures - constant
currency
A number of our key performance indicators are provided at "constant
currency". The percentage change in a KPI is shown assuming the current year
exchange rate is used to translate both the current year and prior year
figures. The table below reconciles the constant currency figures to those
reported.
Performance measure 2021 2020 as originally reported Constant currency adjustment 2020 at constant exchange rates Change at reported exchange rates Change at constant exchange rates
Group recurring revenue £14,343k £13,009k £(316)k £12,693k 10% 13%
Group total revenue £15,448k £14,141k £(298)k £13,843k 9% 11%
SmartVault recurring revenue £6,439k £5,434k £(185)k £5,249k 18% 26%
SmartVault total revenue £6,817k £5,703k £(193)k £5,510k 20% 27%
Virtual Cabinet recurring revenue £7,881k £7,575k £28k £7,603k 4% 4%
Virtual Cabinet total revenue £8,608k £8,471k £28k £8,499k 1% 1%
Group Annualised Recurring Revenue £15.8m £13.7m £0.1m £13.8m 16% 16%
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