Elecosoft Regulatory News (ELCO)

For release 07 April 2020

Elecosoft Plc

("Elecosoft" or the "Company") 

Trading update

The Board of Elecosoft (AIM: ELCO) releases the following trading statement in respect of the year ended 31 December 2019 ("FY19").

Trading

Further to the trading statement of 21 January 2020, the Board confirms that the unaudited results for FY19 show that turnover and profit before tax of Elecosoft for the year ended 31 December 2019 are each significantly higher than the respective levels achieved in the year ended 31 December 2018.

Elecosoft also improved its cash generation significantly in 2019, having eliminated its net bank debt position of £1.8m as at 31 December 2018, and ending the year ended at 31 December 2019 with a net cash position of £1.1m.

Despite the macroeconomic uncertainty caused by the Covid-19 pandemic, Elecosoft traded well in the first quarter of 2020. However, feedback from some of our customers and channel partners suggests that we are likely to experience a degree of disruption to our operations going forward due to the impact of the Covid-19 outbreak in the period. For example, we have already experienced some disruption to the delivery of our face-to-face services which currently account for 19 per cent of our total revenues. However, we have already taken steps to mitigate the impact of this disruption and all our face-to-face training and consultancy offerings are now being offered and delivered online to our customers.

The Board of Elecosoft concluded, on advice, that home working arrangements would provide a safer working environment for Elecosoft employees during the Covid-19 pandemic, than working in their Elecosoft offices. The health and wellbeing of our employees are our priority and accordingly, all employees in all the countries in which we have business units, including Sweden, are now enabled to work from home. Home working has also enabled us to deal very effectively with a significant increase in the demand that we have experienced for our hosted and mobile training and support services, as well as reducing costs.

Financial

We are always conscious of the need to manage and conserve our cash resources carefully and in present conditions we have been even more vigilant in the control of operational costs and our general overheads because the maintenance of our financial strength is critical.

The Board approved and paid an interim dividend in October 2019 in respect of the year ended 31 December 2019 and Elecosoft's excellent trading performance and cash generation in the second half of 2019 would normally have warranted the declaration of final dividend. However, in view of the uncertainties currently posed by the Covid-19 pandemic, we do not consider ourselves to be in "normal times" and therefore the Board has decided not to recommend the payment of a final dividend or to declare a second interim dividend, in respect of the year ended 31 December 2019.

Audited Accounts for the year ended 31 December 2019

Audited accounts of Elecosoft for the year ended 31 December 2019 will be released in due course. Shareholders and the Market will be informed of the date of the release when the date is confirmed.

The Board and its advisors have given careful consideration to the rapidly evolving Government guidance in respect of the COVID-19 pandemic and concluded that it would not be appropriate to include in this trading statement any reference which might be construed as predicting the company's likely trading performance in the short-term.

Enquiries:

About Elecosoft plc

Elecosoft plc is an AIM-listed (AIM: ELCO) software company with interests based principally in the UK, Sweden, Germany, Benelux, and the US. Elecosoft develops award winning software applications and related services to the architectural, engineering, construction and owner/operator sectors.

Elecosoft delivers a portfolio of software for project management, estimation, visualisation, Building Information Modelling (BIM), property management and digital marketing disciplines.

Elecosoft's software and services are used during early planning stages through to construction and facilities management, driving the performance and day-to-day operations of its customers' businesses.

For further information please visit www.elecosoft.com.