Last checked at 20 Jul 2023 07:00
20 July 2023
NETCALL PLC
("Netcall", the "Company" or the "Group")
Trading Update and Contract Renewal
Strong cloud momentum and $20m contract extension
Netcall plc (AIM: NET), the leading provider of intelligent automation and customer engagement software, today provides an update on trading for the year ended 30 June 2023 and announces the renewal of a significant contract.
Trading Update
The Board is pleased to confirm that positive trading has continued through the second half of the financial year. Revenue is expected to have grown by 18% to £36.0m (FY22: £30.5m) and adjusted EBITDA(1) by 25% to £8.0m (FY22: £6.4m).
The main growth driver continues to be sales of the Group's cloud offerings, with cloud annual contract value ('ACV')(2) increasing by 21% to £18.1m (FY22: £15.0m), contributing to total ACV growth of 15% to £27.9m (FY22: £24.2m). Underlying cloud ACV (excluding the significant contract announced in June 2022) increased 32% and underlying total ACV grew 21%.
This strong business performance generated excellent cash flow in the year, resulting in a year end net cash position of £24.8m (30 June 2022: £14.1m). The Group has no debt.
Contract Renewal
On 10 June 2022, Netcall announced a significant $19m three-year cloud subscription contract with a S&P 500 financial services firm (the "Customer") and Netcall's Liberty platform is now live with the Customer in more than 60 countries. Following a strategic review by the Customer to rationalise its vendor landscape, Netcall's Liberty platform has been re-selected to support the Customer's digital transformation ambitions. As a result of which, the Group has now agreed a replacement five-year contract valued at $20m in total (the "Contract Renewal") representing a $6m uplift to the remaining contract value, with an expected revenue contribution of $4m per annum over the new term.
Henrik Bang, Chief Executive, commented:
"We continue to see healthy demand for the Group's Intelligent Automation and Customer Engagement solutions, resulting in double digit revenue growth and enhanced profitability. We saw strong uptake from new customers as they look to streamline their organisations to improve efficiencies and reduce costs.
"The renewal of our landmark contract with a large global financial services firm is a strong endorsement of the quality of our solutions and we look forward to supporting the Customer's digital transformation ambitions.
"Underpinned by a robust balance sheet, strong pipeline of new business and increasing visibility, we look forward with confidence in the Group's long-term prospects."
(1) Profit before interest, tax, depreciation and amortisation adjusted to exclude the effects of acquisition, impairment, contingent consideration, share-based payments and non-recurring transaction costs.
(2) ACV, as at a given date, is the total of the value of each cloud and support contract divided by the total number of years of the contract (save that the Contract Renewal is included at the new annual amount of $4m).
For further enquiries, please contact:
Netcall plc | Tel. +44 (0) 330 333 6100 |
Henrik Bang, CEO |
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Michael Jackson, Chairman |
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James Ormondroyd, Group Finance Director |
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Canaccord Genuity Limited (Nominated Adviser and Joint Broker) | Tel. +44 (0) 20 7523 8000 |
Simon Bridges / Andrew Potts |
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Singer Capital Markets (Joint Broker) | Tel. +44 (0) 20 7496 3000 |
Harry Gooden / Asha Chotai |
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Alma PR | Tel. +44 (0) 20 3405 0205 |
Caroline Forde / Hilary Buchanan / Matthew Young |
About Netcall
Netcall's Liberty software platform with Intelligent Automation and Customer Engagement solutions helps organisations digitally transform their businesses faster and more efficiently, empowering them to create a leaner, more customer-centric organisation.
Netcall's customers span enterprise, healthcare and government sectors. These include two-thirds of the NHS Acute Health Trusts and leading corporates including Legal and General, Lloyds Banking Group, Aon and Santander.
For further information, please go to www.netcall.com.
Prior to publication the information communicated in this announcement was deemed by the Company to constitute inside information for the purposes of article 7 of the Market Abuse Regulations (EU) No 596/2014 as amended by regulation 11 of the Market Abuse (Amendment) (EU Exit) Regulations No 2019/310 ('MAR'). With the publication of this announcement, this information is now considered to be in the public domain.