Last checked at 6 Nov 2017 13:58
6 November 2017
INTERCEDE GROUP plc
("Intercede", or the "Group")
Trading Update
Further to the trading update of 5 October 2017, Intercede has experienced a slower market than expected and a number of large enterprise awards anticipated for this quarter have so far failed to materialise in spite of customer commitments to the contrary. This suggests a tightening of fiscal controls inside the customer base over which Intercede has no control. While these orders are expected to be awarded eventually, customer delays are making accurate forecasting for the financial year extremely challenging.
Specifically, Intercede was informed in writing on 3 November 2017 that a significant order of over $2m from an existing customer that was forecast to be received in the current financial year ending 31 March 2018, will not now be raised until the first quarter of the next financial year. This deferral of sales revenue will have a material impact on the Group's ability to meet market expectations.
Intercede is now forecasting revenue growth for the current financial year in the range of 10%-20%. This is based on the timing of receipt of a small number of large orders and Intercede's subsequent ability to deliver and recognise revenues in accordance with the Group's accounting policy.
Existing customers are continuing to invest in MyID solutions and the renewal of support and maintenance contracts. Intercede is therefore receiving the full cash benefit of these renewals even though we can only recognise pro-rata revenues in the current year. In addition to an R&D tax credit of £1.1m, that was received in July 2017, this has resulted in cash balances of £4.2m as at 31 October 2017.
Richard Parris, Chairman and CEO, said, "the market has never been in more need of the solutions we provide, we have recently invested in a world-class sales team and we have migrated our platform to also operate in the Cloud on a subscription based model. We are poised for take-off in new mid-market enterprise and consumer oriented markets. Unfortunately, short term sales in our traditional markets have been disappointing and are challenging our plans for organic growth."
Contact
Intercede Group plc | Tel: +44 (0) 1455 558 111 |
Richard Parris | Chairman & Chief Executive |
Andrew Walker | Finance Director |
finnCap | Tel: +44 (0) 20 7220 0500 |
Stuart Andrews | Corporate Finance |
Simon Hicks | Corporate Finance |
Capital Access Group | Tel: +44 (0) 20 3763 3400 |
Scott Fulton | Media |
Ed Welsby | Investors |
About Intercede
Intercede is a software and service company specializing in identity, credential management and secure mobility. Its solutions create a foundation of trust between connected people, devices and apps and combine expertise with innovation to provide world-class cybersecurity. Intercede has been delivering solutions to high profile customers, from the US and UK governments to some of the world's largest corporations, telecommunications providers and information technology firms, for over 20 years. Intercede's product portfolio includes MyID, an identity and credential management system that assigns trusted digital identities to employees citizens and machines. In 2015, Intercede launched MyTAM, enabling trusted applications to be loaded into a mobile device's Trusted Execution Environment (TEE), providing hardware-level security for Android apps. In 2016, Intercede launched RapID, a secure, easy to implement authentication service for mobile apps and cloud services to completely eliminate the need for passwords.
For more information visit: www.intercede.com
The information communicated in this announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014.