21st Aug 2024 10:43
(Alliance News) - Rosslyn Data Technologies PLC on Wednesday said it expects to report weaker results for financial 2024, but announced a major new contract win with "a global household name".
The stock surged up 38% to 12.81 pence per share in London on Wednesday morning.
The London-based data analytics company anticipates revenue of GBP2.9 million for the year that ended on April 30, down 3.3% from GBP3.0 million the previous year.
Rosslyn's adjusted loss before interest, taxes, depreciation, and amortisation is expected to widen to GBP2.5 million from GBP2.0 million.
Rosslyn attributed this to lower revenue and greater costs, as it expanded activity levels following a period of significant restructuring.
Rosslyn increased its holding of cash and cash equivalents by 5.2% to GBP807,000 from GBP767,000.
"The company increased its pricing for its professional services work to appropriate market levels...[the] R&D team, under the leadership of the newly appointed fractional chief technology officer, has conducted an in-depth internal project to increase platform efficiency, which will result in reduced costs going forward," Rosslyn said. "As the company expands its business it will also benefit from a number of economies of scale, such as being able to increase its Azure platform usage by up to 50% without incurring additional cost."
At the end of the financial year, Rosslyn's total contract pipeline stood at GBP3.3 million, down 17% from GBP3.6 million last year.
On Wednesday, however, Rosslyn said it won a new three-year contract which has a minimum revenue value of GBP2 million. Of this, GBP700,00 will be received in the current financial year, with additional opportunities for growth through expansion into other divisions and operations.
Rosslyn said: "The customer, headquartered in the US, is a multinational technology company, a global household name and one of the top 10 Fortune 100 companies. The customer provides, inter alia, cloud services and is engaged in activities such as e-commerce, online advertising, digital streaming and artificial intelligence."
The contract with the customer's central procurement division follows a competitive nine-month tender process, with Rosslyn opting to appoint an external provider instead of developing its own in-house artificial intelligence solution.
"The board is focused on achieving positive adjusted Ebitda and cash generation on a monthly basis by the end of the current financial year and on an annual basis from FY 2026, which will drive accelerated revenue growth in the medium term," Rosslyn added.
By Elijah Dale, Alliance News reporter
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