7 Feb 2013 14:25
7 February 2013
Imaginatik Plc
("Imaginatik" or the "Company")
Trading Update
Imaginatik plc (AIM: IMTK.L), the world's first full service innovation provider offering a range of technology products and consultancy, today announces an update on trading for the year ending 31 March 2013.
While good progress has been made this year on signing new customers and up-selling to existing customers, three long-standing customers which were expected to renew in the second half of the year have opted not to do so, due to budgetary constraints. These three contracts were expected to generate licence fee income of approximately £0.35m to be recognized in the results for the current financial year.
Each of these contracts was based on the Company's old 'technology only' model with no consultancy support, a model which Imaginatik is making efforts to move away from in order to increase both the effectiveness of the innovation programmes and the stickiness of the customer base.
In addition to the loss of these contracts, there remains some uncertainty over the timing of the signatures on some potential new contracts. The timing of contract signatures may impact the level of loss for the year and the Company's working capital requirements.
Therefore, the Board believes both revenues and operating losses are likely to be below market expectations.
In light of the above, the Company is considering the possibility of seeking shareholder approval of the cancellation of trading in the Company shares on AIM ("Admission"). The Directors of the Company consider that the costs associated with maintaining Admission may not be currently justified by the benefits given the low liquidity in the Company's shares and the current difficulties in sourcing equity financing for smaller companies in the public markets. A further announcement will be made in due course.
Matt Cooper, Executive Chairman of Imaginatik, commented: "The number of new blue-chip companies turning to Imaginatik as their innovation partner of choice is a fantastic endorsement of our business. However, our return to revenue growth and profitability has not been as swift as we would hope. We do however continue to firmly believe the long-term prospects for the Company to be significant. The Board will now commence a review as to whether maintaining the AIM listing is in the best interests of the Company's shareholders."
For further information please contact:
Imaginatik plc | Tel: 020 7917 2975 |
Matt Cooper, Executive Chairman / Shawn Taylor, CFO | |
Northland Capital Partners Limited | Tel: 020 7796 8800 |
Edward Hutton / William Vandyk | |
Newgate Threadneedle | Tel: 020 7653 9850 |
Caroline Evans-Jones / Hilary Millar |
About Imaginatik
Imaginatik provides a range of Innovation solutions comprised of consultancy, enterprise software and program management to deliver innovation results to companies such as The World Bank, The Chubb Group of Insurance Companies, State Farm, Exxon Mobil, Pfizer, Goodyear, Paccar and Cargill. Few companies possess the internal capability to consistently generate fresh ideas, identify those worth pursuing and reliably transform them into real, value-enhancing assets. Imaginatik's mission is to help these companies build sustainable innovation competencies.
Imaginatik is a public company whose shares are traded on the AIM market of the London Stock Exchange (LSE:IMTK.L) and is a World Economic Forum Technology Pioneer with offices in Boston, MA, and Winchester, UK. For more information visit www.imaginatik.com.