System1 revenues grow YOY

Software group System1 said on Tuesday that revenues had grown year-on-year, buoyed by the successful launch of its TYA Pro+ offering and strong platform revenue growth in the US.

Revenues were up 28% year-on-year at £30.0m, while platform revenues grew 42% in the twelve months ended 31 March. System1's Communications product group delivered the majority of revenue growth, with gains in its Innovation unit offsetting a reduction in its Brand products.

New business performance was said to be "strong throughout the year", with over 250 new clients providing just over a quarter of total revenue. All geographic regions achieved "substantial double-digit Revenue growth" for the year.

System1 also noted that following an "exceptional H1", gross profit margins returned to expected levels in H2, achieving 87.0% for the year as a whole, ahead of its 85% benchmark. Net cash increased by £3.3m in H2 and £3.9m across the year, resulting in year-end net cash of £9.6m.

The AIM-listed group highlighted that based on unaudited management accounts, full-year pre-tax profits were now expected to amount to £2.8m, up £2.1m on FY23 and ahead of market expectations. Adjusted EBITDA margins for the year were expected to exceed 14%.

Chief executive James Gregory said: "Our first full year post the 2022 strategic review has surpassed our expectations. We have delivered £30.0m of revenue, up 28% year on year, growing quarter on prior quarter throughout the year. This is underpinned by over 250 new client wins, platform revenue up by over 40% and profit before taxation up by 300% on the previous year. In the coming year we will step up investment in attracting, winning and retaining customers in order to continue our growth trajectory".

As of 1025 BST, System1 shares were up 0.20% at 501.0p.

Reporting by Iain Gilbert at Sharecast.com