System1 FY revenues grow, profits fall on elevated opex

Marketing platform operator System1 said on Wednesday that revenues had grown in the twelve months ended 31 March but cautioned that full-year adjusted pre-tax profits looked set to have fallen significantly due to increased investments.

System1 said full-year revenues had risen 6% to £24.1m, with data revenues increasing by £8.4m year-on-year to £9.7m, representing 40% of total income.

Adjusted operating expenditure, principally employee-related costs, rose 18% year-on-year, reflecting planned investment in its people, partnerships, and platform.

The AIM-listed firm stated profitability was stronger in the first half than in the second, as the planned increase in operating costs coincided with a reduction in revenue during the final quarter.

System1 now expects to report an adjusted pre-tax profit of roughly £1.1m for the full year, down from £3.0m a year earlier, while statutory pre-tax profits were pegged to be approximately £800,000, a marked reduction when compared to the prior year's £2.1m.

Looking forward, System1 said it remains focused on achieving revenue growth over the short- and medium-term after having stepped up investment to develop and commercialise its automated marketing predictions.

"We intend to grow revenue and profits in the course of the new financial year and anticipate that the growth will be weighted to the second half of the year as expenditure flattens versus last year," said System1.

As of 0920 BST, System1 shares were up 0.91% at 272.46p.