ActiveOps sees continued first-half growth

Management process automation software company ActiveOps reported continued first-half growth in a trading update on Tuesday, with the group trading in line with its expectations, and on target to turn run-rate EBITDA positive at the end of the financial year.

The AIM-traded firm said it had continued to expand its customer base, and benefit from its high recurring revenues, strong gross margins and strong balance sheet.

Software-as-a-service revenues in the period were up about 14%, driving 12% growth in exit annual recurring revenue to £22.1m for the six months ended 30 September, providing a “strong basis” for the full year expected performance.

The group said it expected to report overall revenue growth of around 7%, and a stronger-than-expected profit performance marginally above breakeven at the adjusted EBITDA level, due to the positive impact of currency movements in the period.

Cash and cash equivalents as at 30 September totalled £11m, compared to £10.9m a year ago.

The first half saw the signing of new WorkiQ and ControliQ customers, alongside “substantial” expansion deals across the product offering and territories, as the firm executed its ‘land and expand’ sales strategy.

Meanwhile, the group's third offering, CaseworkiQ, was successfully launched and had shown to be “highly applicable” across the existing customer base, contributing to the growth in annual recurring revenue and creating further upsell opportunities.

The group said it had continued the development of its product suite, with a focus on the introduction of machine learning-based capabilities, as ActiveOps seeked to provide its customers with “increasingly dynamic and sophisticated” tools to help manage the “growing complexity” of the back-office.

“As the reality of the post Covid-19 work environment is fully realised, the need for our solutions continues to grow and resonate with our expanding, global, blue-chip customer base,” said chief executive officer Richard Jeffery.

“With products that are more relevant than ever, high levels of recurring revenue and a robust balance sheet, we are well placed to mitigate potential economic headwinds while continuing to invest in the business and execute our growth plans.”

ActiveOps said it would release its results for the six months ended 30 September on 29 November.

At 1032 BST, shares in ActiveOps were up 0.47% at 74.35p.

Reporting by Josh White at Sharecast.com.