Dotdigital falls despite half performance in line with expectations

(Alliance News) - Dotdigital Group PLC said Thursday its first half performance will lead to its full-year results meeting market expectations.

Shares in Dotdigital were down 11% at 159.20 pence on Thursday in London.

For the six months to December 31, the company's first half, Dotdigital reported group revenue of GBP30.9 million. This is a 10% increase on the same period of the previous year in which revenue totalled GBP28.2 million.

The London-based online marketing company cited growth in sales from both new and existing customers for the rise in revenue.

Average revenue per customer was up by 19% to GBP1,422 per month from GBP1,196 per month the previous year, this was driven by a continued increase in new and existing client spend according to Dotdigital.

It added that, against a strong prior year comparator, revenue from text sends is now at more normalised levels but explained that research and development continued to underpin the company's growth strategy, with recurring revenues from enhanced product functionality growing by 22% to GBP10.8 million from GBP8.9 million.

Revenue, adjusted earnings before interest, tax, depreciation and amortisation and adjusted profit before tax are expected to be in line with market expectations. For the year ending June 30, market consensus for revenue for the year ending June 30 is GBP65.6 million. Consensus for adjusted Ebitda is GBP20.9 million. Consensus for adjusted profit before tax is GBP14.5 million.

The previous year, Dotdigital reported full-year revenue of GBP58.1 million, adjusted Ebitda of GBP19.8 million, and a pre-tax profit of GBP12.8 million.

Chief Executive Milan Patel said: "The group delivered another half year period of double-digit growth, with continued sales momentum across channels from new and existing customers. These results demonstrate a growing interest in our core offering and continued execution of the growth strategy in a structurally growing market.

"The group's continued growth is supported by a strong balance sheet, a recurring software as a service business model and healthy sales pipeline, putting us in a strong position as we enter the second half of the year. Whilst cognisant of the fluid global economic environment, the board is confident in the continued positive performance of the business."

Dotdigital said it will announce its half-year results on March 3.

By Heather Rydings; heatherrydings@alliancenews.com

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