27th Aug 2020 14:25
(Alliance News) - Sopheon PLC on Thursday posted a fall in profit for the first six months of 2020, as it said it has seen an increase in customer non-renewal notices or user reduction notices since May.
Shares in the enterprise software provider were trading 4.4% lower at 880.00 pence each on Thursday afternoon in London.
For the six months ended June 30, Sopheon posted pretax profit of USD479,000, plunging 44% year-on-year from USD855,000. This was despite a slight rise in revenue to USD13.9 million from USD13.7 million. Gross margin slipped to 67% from 69%.
The company said from May, it started to see an increase in customer non-renewal notices or user reduction notices, with its annual recurring revenue retention rate is now at around 94%. It has more than made up for this with new orders, however.
Looking ahead, Sopheon said it looks to an acceleration in sales in the second half of the year provided the global circumstances related to the Covid-19 pandemic do not take a further turn for the worse.
"Several of Sopheon's vertical markets continue to show resilience to the crisis. However, our customer base is not immune to the difficulties faced by the general markets. Revenue visibility for full year 2020 is USD25.5 million, underpinned by [annual recurring revenue] at USD16.5 million, net cash at USD21.9 million and a substantial, active sales pipeline - even in the toughest environment in decades, these positive metrics give us a solid platform from which to proceed with our strategy," said Chair Barry Mence.
By Ife Taiwo; [email protected]
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