Ideagen trades in line with expectations
(ShareCast News) - Information management software provider Ideagen updated the market on its trading for the year to 30 April on Wednesday, ahead of the announcement of its full year results on or around 18 July.
The AIM-traded company's board reported that results to 30 April were expected to be in line with market expectations, and that trading was once again "robust" across all key verticals, with particular success within the life sciences, aviation and financial sectors.
It said the group delivered organic revenue growth of approximately 10%, together with further contributions from all four acquisitions made during the year.
That represented the Group's eighth consecutive year of revenue and adjusted EBITDA growth.
Ideagen said it expected to report revenue of approximately £27.1m and adjusted EBITDA of approximately £7.8m - both having increased by approximately 24%, and a significant increase in adjusted earnings per share, which the board said continued to be an important financial metric for the group.
The board said it was confident that the transition from a traditional 'perpetual licence' business model to a 'subscription licence' model was well underway, as evidenced by a significant increase in the run-rate of recurring revenues.
That had been driven primarily by the success of Coruson - the company's software-as-a-service based enterprise risk and safety management solution, which was allowing the Group to win larger contracts and grow high visibility, subscription-based revenue.
Cash generation was extremely strong at the end of the financial year, the board claimed, and accordingly net cash at 30 April was significantly ahead of market forecasts at £4.2m - even after paying £4.6m of consideration for the acquisitions of IPI Solutions and Gael and £0.3m in dividends.
The board expected to report that cash generated by operations would be in excess of 100% of adjusted EBITDA.
"We are pleased to report that the group has continued to perform well in delivering another year of high quality earnings growth underpinned by strong cash generation," said chief executive David Hornsby.
"We have also made four important acquisitions which have provided scale, product capability and recurring revenues."
The company continued to grow organically and to increase the percentage of its revenues derived from recurring business, Hornsby commented.
"The group has significant contracted work in progress and a strong pipeline of new business opportunities which provides the board with confidence for the current year and beyond."