29th Apr 2020 14:51
(Alliance News) - Proactis Holdings PLC on Wednesday reported a swing to loss in the first half of financial 2020 as it expressed confidence in its strategy for organic growth in the medium-term.
Shares in the spend-management firm were trading 2.6% lower at 28.44 pence each on Wednesday afternoon in London.
For the six months ended January 31, Proactis posted a pretax loss of GBP2.2 million, swinging from a profit of GBP400,000 in the comparative period a year prior. Revenue was down 12% to GBP24.5 million from GBP27.7 million.
The company said the lower revenue was due to the loss or downgrade of contracts with existing customers in its core business. However, it said its annualised recurring revenue for the 12 months to the end of January was GBP40.7 million, up on the GBP39.3 million seen the year before, adding that the rise represents a 3.6% organic growth in its core business.
Proactis said that for the six months to the end of January, the value of contracts signed - excluding renewals - was GBP7.5 million, up from GBP6.1 million a year prior.
Operating expenses rose to GBP1.4 million from GBP1.1 million.
Looking ahead, Chief Executive Tim Sykes said: " The group has dealt with the immediate effect of the Covid-19 crisis extremely well and the recurring revenue, long-term contract business model is proving resilient at this stage. Whilst mindful of the wider economic outlook, the group's return to organic growth in its annualised recurring revenue coupled with its forward revenue visibility, profitability and solid financial position provides me and the board with confidence that the group can now move forward confidently to execute its strategy and realise its potential."
Net bank debt as at the end of January was GBP35.6 million, down from GBP36.5 million as at the end of July 2019.
By Ife Taiwo; [email protected]
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