Gresham Regulatory News (GHT)

5 July 2022

Gresham Technologies plc

Trading Update and Notice of Results

Strong first-half performance and confidence in Full Year

Gresham Technologies plc (LSE: "GHT", "Gresham", "Company" or the "Group"), the leading software and services company that specialises in providing solutions for data integrity and control, banking integration, payments and cash management, is pleased to provide the following update for the half year ended 30 June 2022 ("H122").

The Board reports that positive trading has continued throughout the first half of the year with Group revenue and profitability performing strongly. Subject to finalisation of the half year results, the Company expects to report the following:

Group revenues in the period increased 56% to approximately £23.1m, including a positive contribution from Electra Information Systems Inc ("Electra") which became part of the Group on 22 June 2021. Excluding the contribution from Electra, year-on-year Group organic revenue growth was 19%, representing a strong improvement on the organic growth rate in the equivalent period last year of 14%.

In line with the Board's strategy to build sticky subscription revenues, forward looking Clareti Annual Recurring Revenue increased to £25.9m at period end, representing an organic increase of 17% on the position as at 30 June 2021. The pipeline of opportunities continues to grow and, in the first six months of the year, the Group partnered with six new customers and achieved more than twenty upsells and cross-sells with existing customers, including the significant Tier 1 bank contract announced on 6 May 2022.

The non-Clareti business has performed ahead of plan in the first half and has the potential to maintain outperformance in the second half depending upon the value of certain material annual renewals expected in late Q3 and early Q4.

Group adjusted EBITDA and cash adjusted EBITDA are in-line with Board expectations reflecting the strong revenue performance, Electra synergies and the continued strategic investments balanced alongside the on-going navigation of industry-wide inflationary pressures.

The Group retains a strong balance sheet with net cash of £6.4m and no debt as at 30 June 2022.

The Group's record levels of recurring revenue, strong customer retention rates, continued strong performance of non-Clareti business and high visibility of the second half pipeline give the Board confidence in achieving at least market expectations1 for the full year and of starting 2023 with strong momentum. The Group expects to be able to provide further positive updates throughout the second half.

Notice of Results

The Group expects to announce its interim results for the six months ended 30 June 2022 on 26 July 2022. Further details regarding presentations for investors and analysts will be announced in due course.

Ian Manocha, CEO, commented:

"The Group delivered another strong period of growth in the first half of the year underpinned by a consistent conversion rate of competitive new customer wins coupled with significant cross- and up- selling success. The transformational building blocks put in place last year with the acquisition of Electra, which brought us scale, an enlarged international footprint and enhanced technology capability, are working together to drive new growth opportunities and high-quality subscription earnings.

"We enter the second half with a robust pipeline of demand and a substantial opportunity to take further market share in our core financial services market. Our strengthened service and product offering is helping to accelerate digital strategies for our customers, giving them confidence in their operations to radically improve performance and competitiveness. The Group's positive trading momentum, robust balance sheet and growing recurring revenues provide the Board with confidence in the remainder of the year and beyond."

1 The Company believes that current market expectations for the year ending 31 December 2022 are revenues of £42.0m and adjusted EBITDA of £9.2m, with £46.2m and £10.6m respectively for the year ending 31 December 2023.

Enquiries

Inside information

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 ("MAR"). Upon the publication of this announcement via a Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain.

Note to editors

Gresham Technologies plc is a leading software and services company that specialises in providing real-time solutions for data integrity and control, banking integration, payments and cash management. Listed on the main market of the London Stock Exchange (GHT.L) and headquartered in the City of London, its customers include some of the world's largest financial institutions and corporates, all of whom are served locally from offices located in the UK, Europe, North America and Asia Pacific.

Gresham's award-winning Clareti software platform is a highly flexible and scalable platform, available on-site or in the cloud, designed to address today's most challenging financial control, risk management, data governance and regulatory compliance problems. Learn more at www.greshamtech.com.