REG - Pelatro PLC - Trading update

PelatroAnnouncement

10/01/2023 13:30

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RNS Number : 2817M  Pelatro PLC  10 January 2023

10 January 2023

Pelatro Plc

 

("Pelatro", the "Company" or the "Group")

 

Trading update

 

Pelatro Plc (AIM: PTRO), the Customer Engagement Hub software specialist for
enterprises, announces the following update to trading for the year ended 31
December 2022.

 

The Group is in the advanced stages of renegotiating a license contract for
its mViva product entered into earlier in 2022 to convert it into a managed
services contract. If so renegotiated, the cash flow quantum and profile would
remain broadly unchanged, but the Group would benefit from an addition to
recurring revenue (of just under $0.4m) and the termination of the contract
after 3 years and prospective renewal on revised terms thereafter, rather than
a perpetual license. If not recognised in 2022 following renegotiation is
expected to reduce FY2022 revenue by c. $0.9m.

 

Furthermore, the Group agreed terms for a license contract in late 2022, which
revenue was expected to accrue in FY2022; however, it is now expected that the
majority of the revenue from that contract will be recognised early in 2023.
The impact on revenue for FY2022 will be in the order of $1.5m although the
cash income from the contract remains broadly unchanged in timing and amount.
ARR is likewise unaffected.

 

Additionally, the Group has been unable to agree on appropriate terms of
implementation of a license contract entered into in 2021 with a small
customer. The Group may withdraw from this contract which would lead to a
provision of c.$0.3m being made against the carrying value of the contract (in
contract assets). No penalties or similar costs would arise from such a
withdrawal.

 

The $2.4m revenue adjustments referenced above will have a commensurate impact
on profitability in FY2022 (but are expected to contribute and be recognised
in following years), hence FY2022 outturn is now expected to be materially
below current market expectations

 

 

For further information contact:

 

 Pelatro Plc
 Subash Menon, Managing Director                       c/o finnCap
 Nic Hellyer, Chief Financial Officer

 finnCap Limited (Nominated Adviser and joint broker)  +44 (0)20 7220 0500
 Carl Holmes/Milesh Hindocha (Corporate Finance)

 Dowgate Capital Limited (joint broker)                +44 (0)20 3903 7715
 Stephen Norcross

 

This announcement contains inside information for the purposes of article 7 of
the Market Abuse Regulation (EU) 596/2014 as amended by regulation 11 of the
Market Abuse (Amendment) (EU Exit) Regulations 2019/310. With the publication
of this announcement, this information is now considered to be in the public
domain.

 

Notes to editors

 

The Pelatro Group was founded in March 2013 by Subash Menon and Sudeesh
Yezhuvath with the objective of offering specialised, enterprise class
software solutions for customer engagement principally to telcos who face a
series of challenges including market maturity, saturation and customer churn.

 

Pelatro provides its "mViva" platform for use by customers in B2C and B2B
applications, and is well positioned in the Customer Engagement space. Our
technology orchestrates the digital journey of the customers of the telcos
through contextual, relevant and real time offers and loyalty programs across
multiple channels including websites, social media, apps and others.

 

For more information about Pelatro, visit www.pelatro.com

 

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