PROACTIS Holdings PLC

Trading Update & Notice of Results

PROACTIS Holdings PLC, the global Spend Control and eProcurement solution provider, is pleased to update the market on trading for the year ended 31 July 2016. 

The Group has delivered substantial progress in all of its growth opportunities and expects to report revenues of approximately £19.4m (2015: £17.2m), an increase of 13%, with adjusted¹ EBITDA of approximately £5.3m (2015: £4.8m), an increase of 10%, in line with expectations.

New names and product penetration

§ 46 new name deals (2015: 39), an increase of 18%, including 29 (2015: 20) on long term subscription contracts

§ £6.9m Initial Contract Value² (2015: £5.2m), an increase of 33%

§ 95 up-sell deals (2015: 82), an increase of 16%

§ 8 cross-sell³ deals (2015: Nil)

In addition, the Group has added a further 17 new names through Due North Limited, following completion of the acquisition on 2 February 2016.

Forward revenue visibility

The above performance, allied to the Group's strong performance in customer contract renewals, has contributed to a substantially strengthened forward revenue visibility:

§ Order book⁴ of £26.1m (2015: £19.7m), an increase of 32%

§ Annualised contracted revenue⁵ of £17.7m (2015: £14.3m), an increase of 30%

M&A activity

Following the completion of the acquisition of Due North Limited, the integration is progressing in line with expectations and, as part of this process, the Group has initiated a detailed customer engagement programme and made £0.4m of annualised cost savings. The acquisition delivers more than 300 customers and offers a rich cross sell opportunity through the Group's wider solution set.

The Group is continuing its search for value in further M&A opportunities in this extremely active market.

Supplier Commerce (formerly known as Activate)

The Group has delivered on its objectives in this exciting and substantial new growth opportunity with three customer commitments from Screwfix, Flintshire County Council and P&O Ferrymasters.  These customers bring an aggregate of approximately 15,000 suppliers to the Group's network with an annual spend estimated to be over £1 billion.  The Group has taken its first revenues from this source, which were nominal in this financial year, and it is well placed to accelerate this substantially to material levels during the coming financial years through networking fees and an innovative Accelerated Payment Facility.

The Group intends to release its preliminary results on 12 October 2016.

Note 1: Adjusted for non-recurring administrative expenses and share based payment charges.

Note 2: Initial Contract Value is the total initial value contracted with the new name customer on the first contract with that customer.

Note 3: A cross sell deal is where the Group sells a solution of an acquired business into its existing customer base or vice versa.

Note 4: Order book is the total value of contracted forward revenues, deliverable over multiple years.

Note 5: Annualised contracted income is the estimated annual value of revenue contracted with customers as at 31 July 2016, to be recognised during the year ending 31 July 2017.

Rod Jones, Chief Executive commented:

"Our core business is growing strongly and I am particularly pleased with the high levels of new deal intake and retention rates.  Further, our capability to sell more into our current customer base, a key element of our strategy going forward, is starting to deliver with up-sell and cross-sell activity at record levels. 

"I relish the opportunity that the Due North Limited acquisition provides the Group and I am encouraged by the level of new names post acquisition. With a number of initiatives underway to build the customer experience and drive operational efficiency, we believe we will unlock significant opportunities for the Group.

"The transformational opportunity provided by the Group's Supplier Commerce solution is gaining traction.  We have taken first revenues and have a major opportunity with Screwfix, Flintshire County Council and P&O Ferrymasters to prove concept in this challenging and exciting area.  We are building a quality pipeline to roll out the solution into the wider customer base.

"I am delighted to be able to report the substantial progress in all areas of the Group's business over the past year.  Our revenue visibility indicators have advanced substantially and this underpins my confidence in the Group's future prospects."

End

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The information communicated in this announcement is inside information for the purposes of Article 7 of the Market Abuse Regulation 9EU) No. 596/2014.

The financial information contained in this announcement is unaudited and has been extracted from the Group's unaudited management accounts, which are prepared in accordance with IFRS, and other internal sources.

Notes to Editors:

PROACTIS creates, sells and maintains specialist software which enables organisations to streamline, control and monitor all internal and external expenditure, other than payroll.  It is used in over 800 organisations around the world from the commercial, public and not-for-profit sectors. It is the largest independent eProcurement solution provider to the UK Public Sector.

PROACTIS is head quartered in Wetherby, West Yorkshire. It develops its own software using an in-house team of developers and sells through both direct and indirect channels via a number of Accredited Channel Partners.

PROACTIS floated on the AIM market of the London Stock Exchange in June 2006.