REG - itim Group PLC - Trading Update

ITIMAnnouncement

29/02/2024 07:00

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RNS Number : 8420E  itim Group PLC  29 February 2024

29th February 2024

itim Group plc

("itim" or "the Company" and together with its subsidiaries "the Group")

Trading Update

 

"Revenues in line and EBITDA ahead of market expectations - confident of
future outlook"

 

itim Group plc, a SaaS based technology company that
enables store-based retailers to optimise their businesses to improve
financial performance, is pleased to announce an unaudited trading update for
the financial year ended 31 December 2023, ahead of the publication of the
Company's annual results which are anticipated to be released in May 2024.

 

Highlights

 

·    Revenues increased 15% at £16.1m* (2022: £14.0m (audited)) in line
with current market expectations.

 

·    Annual recurring revenue ("ARR") remained constant at approximately
£13.2m* (2022: £13.2m (audited)) representing 82% of revenue as the Group
focused on EBITDA and cash generation.

 

·    EBITDA for the year is expected to be £0.68m* (2022: £0.21m
(audited)) ahead of market expectation of £0.3m.

 

·    Total loss before tax for the year is also anticipated to be ahead of
market expectations.

 

·    Post period end, completion of a significant multi-million pound
contract with Quiz Clothing to implement the Groups first fashion customer on
the end-to-end retail platform.

 

·    As expected, the Group ended the year with cash balances of £1.9m*
(2022: £3.9m (audited)) with no outstanding loans.

In the year ended 31 December 2023, the Group achieved revenue growth of 15%
increasing from £14.0m to £16.1m* as the business pivoted from focussing on
ARR growth to cash generation with service revenues increasing by 64% and
EBITDA increasing by 126%.

 

As the culmination of the two-year investment programme approaches, itim is
pleased to present an update on the progress as it presents an enhanced
product offering, strategically positioning itim for sustained success within
the dynamic retail landscape.

Significant improvements have been made across the product suite. A notable
strategic milestone includes the integration of fashion into the core Retail
Suite, catalysed by the successful Quiz Clothing contract win, which went live
as announced on the 27(th) February 2024. Furthermore, targeted investments in
the Profimetrics platform, Chameleon store systems, Tradeledger for supplier
collaboration, and e-commerce have collectively enhanced the capabilities of
itim's offering. The Company's transformative efforts have led to the creation
of a unified platform, named 'UNIFY.' This rebranding not only consolidates
our products but also better communicates the essence of our Unified Retailing
platform. The positive feedback from customers demonstrates the real impact of
these improvements, strengthening confidence in itim's go-to-market strategy.

 

In alignment with prevailing economic conditions, itim is currently in the
process of "right sizing" its business. This strategic pivot involves a shift
away from 'free' implementation services towards a continual focus on
increasing services revenues and EBITDA. The emphasis on demonstrating the
real 'benefits' of UNIFY through consulting underscores the Company's
commitment to delivering tangible retail value to the retail community.

Over the past eight years, itim has demonstrated a compound average growth
rate of 11%. Despite challenges posed by the recent turbulent macro-economic
environment over the last three years, the Company has navigated these
obstacles with resilience. With a solid foundation laid by the IPO funding, a
further enhancement in the growth rate is anticipated when global economic
conditions improve.

* Unaudited

Ali Athar, Chief Executive Officer, commented, "I am pleased to present a
robust set of numbers for the year with revenue in line and EBITDA ahead of
market expectations demonstrating itim's commitment to improving our strategic
initiatives and positioning the Company for sustained growth and success. We
are delighted to announce the launch of UNIFY, our unified platform which not
only consolidates our product offerings but also provides a seamless and
enhanced experience in the retail landscape. I would like to express our
gratitude for stakeholders for their continued trust and support. We are
encouraged by recent trading and a significant pipeline of new opportunities
which enables the Board to view the future with renewed confidence and
optimism."

 

This announcement contains inside information for the purposes of Article 7 of
the UK version of Regulation (EU) No 596/2014 which is part of UK law by
virtue of the European Union (Withdrawal) Act 2018, as amended ("MAR").  Upon
the publication of this announcement via a Regulatory Information Service,
this inside information is now considered to be in the public domain.

Enquiries:

 

 Itim Group plc                   Ali Athar, CEO      0207 598 7700

                                  Ian Hayes CFO

 WH Ireland (NOMAD & Broker)      Katy Mitchell       0207 220 1666

                                  Harry Ansell

                                  Darshan Patel

 IFC Advisory                     Graham Herring      0207 3934 6630

                                  Florence Chandler

 

ABOUT ITIM

itim was established in 1993 by its founder, and current Chief Executive
Officer, Ali Athar. itim was initially formed as a consulting business,
helping retailers' effect operational improvement. From 1999 the Company began
to expand into the provision of proprietary software solutions and by 2004 the
Company was focused exclusively on digital technology. itim has grown both
organically and through a series of acquisitions of small, legacy retail
software systems and associated applications which itim has redeveloped to
create a fully integrated end to end Omni-channel platform.

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