LONDON (Alliance News) - Arria NLG PLC shares tumbled on Friday despite reporting a narrower pretax loss and a substantial rise in revenue during the last financial year, as it prepares to launch new tools aimed at securing a new and diversified client base.
Arria shares were trading down 15% to 27.52 pence per share on Friday.
Arria develops and provides "natural language generation" software which translates complex data into understandable language for its clients.
The company said revenue increased by almost 90% in the last financial year ended September 30, to GBP1.5 million from only GBP787,000 a year earlier, leading its pretax loss to narrow to GBP8.3 million from GBP10.9 million.
The increase in revenue improved its gross margin, yielding a gross profit of GBP554,000 compared to only GBP132,000. Most of its revenue currently comes from a contract it has with Royal Dutch Shell PLC, which was signed back in April.
However, it had seven clients contributing to revenue in the year, compared to only two in the previous year as it broadens its portfolio and progresses its technology.
In terms of costs, Arria's administrative expenses dropped to GBP8.7 million from GBP11.1 million, driven by lower impairments, amortisation and "other" costs, partially offset by share-based payments rising to GBP2.4 million from only GBP47,000 a year earlier.
The loss before interest, tax, depreciation, amortisation and those share-based payments came in at GBP4.2 million, narrowing from the GBP6.4 million loss a year earlier.
Cash at the end of the year stood at GBP2.3 million, rising from GBP1.7 million at the end of September 2014.
Arria has been trying to progress the commercialisation of its technology throughout the financial year, concluding deals to provide software to industries such as agriculture, aviation, oil & gas services, insurance, artificial intelligence, banking, meteorology, online travel and consumer packaged goods.
"For the most part, the contracts were with large, global companies that constitute an impressive list of names underlying last year's commercial progress. As we look back over the accomplishments of the past year, we recognize how far we have progressed, and how well the group is positioned for accelerated growth," said Stuart Rogers, chairman and chief executive of the company.
Moving forward, the company plans to diversify its client base as it continues to grow.
"In 2016 we will see Arria's core Natural Language Generation (NLG) technology extended in two new directions. While we will maintain strong commercial progress selling customised instances of our NLG platform to large industrial clients, we will also be bringing two new product groups to market," it said.
"We will be giving developers anywhere the ability to use our NLG technology to build their own natural language generation applications through the release of a set of tools and micro-services we call the NLG software development kit. In addition, we will be launching our first standalone Software as a Service product, targeting the financial management and reporting market," it added.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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