Elecosoft Regulatory News (ELCO)

RNS

23 January 2024

Eleco plc

("Eleco", the "Group" or the "Company")

Year-end trading update

Record Recurring Revenue Growth

The Board of Eleco plc (AIM: ELCO), the specialist software provider for the built environment, is pleased to provide a trading update for the year ended 31 December 2023, based on unaudited management accounts for the period.

Eleco delivered record growth in Annualised Recurring Revenue1 ("ARR") and Total Recurring Revenue ("TRR") reflecting further progression on its growth strategy.

· ARR at 31 December 2023 was approximately £22.6m (at 31 December 2022: £18.2m) an increase of 24%. 

· TRR increased to c. £20.7m (2022: £16.9m) up 22%, and representing 74% of total revenue in 2023, an increase from 64% of total revenues in 2022. 

· Anticipated revenues are estimated to be £28.0m (£28.3m in constant currency terms) and ahead in underlying and constant currency terms by 11% when compared with prior year 2022 reported revenue of £26.6m. 

· Cash as at 31 December 2023 was £10.9m reflecting strong cash generation outside of an acquisition payment and related costs of £3.8m and increased Interim, Final and Special Dividends.

· The Group remains free of debt.

Jonathan Hunter, Chief Executive Officer of Eleco plc said:

"Despite challenging macroeconomic climates and geopolitical uncertainties, Eleco has continued to deliver a robust performance with its underlying revenue growth, and profitability is expected to be ahead of consensus. This reflects our strategic switch to a SaaS business model and our focus on higher margin core products, and the discontinuation of products that were not contributing to the future of the Group. Our focused approach to delivering on our strategy was well demonstrated in 2023, through the expansion of our Portfolio Project Management capabilities in 2023 with the acquisition of BestOutcome and the divestment of Arcon.

"Eleco continues its expansion into the US markets introducing a direct sales approach, having attracted in excess of 40 new direct customers following focused investment on sales and marketing. Our commitment to innovation and excellence was once again demonstrated as Asta Powerproject was awarded 'Project Management Software of the Year' at the UK Construction Computing Awards for the tenth consecutive year.

"We continue to see exciting opportunities with the long-term market growth trends and drivers in the geographies we operate in. Given our established positioning and cash-generative SaaS business model, we are confident of another year of strong organic growth, supplemented by further acquisitions, to widen our international reach and customer-focused capabilities."

The Group's year end results will be published in April, with a date to be confirmed in due course.

1ARR is defined as normalised annualised recurring revenues and includes revenues from subscription licenses, contract values of annual support and maintenance, and SaaS contracts. Normalisation is calculated using the recurring revenue in the final month of the year, multiplied by 12. This ARR figure is calculated including the contribution from the BestOutcome business to the Group going forward.   

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About Eleco plc

Eleco plc is an AIM-listed (AIM: ELCO) specialist international provider of software and related services to the built environment through its operating brands Elecosoft, BestOutcome and Veeuze from centres of excellence in the UK, Sweden, Germany, the Netherlands and the US.

The Company's software solutions are trusted by international customers and used throughout the building lifecycle from early planning and design stages to construction, interior fit out, asset management and facilities management to support project management, estimation, visualisation, Building Information Modelling (BIM) and property management.

For further information please visit www.eleco.com.