AdEPT Technology Group plc (LON:ADT) Chief Executive Officer Phil Race caught up with DirectorsTalk to discuss their Q3 trading update, progress of the Fusion project, how AdEPT Education has helped during the pandemic with schools & the NHS, what investors can expect in the coming months and their Capital Market’s Day.
Q1: You recently published a trading update for Q3 of the current financial year. In the update you announced that you’d reinstated guidance, why now?
A1: I think we’re getting a real strong sense of where the year is going to end and, I think, more importantly, what we’re seeing in terms of the coming year so it feels only right to share that view with our investors.
Q2: How would you describe trading from September to December then?
A2: I think the headline is resilient and I think it’s been a headline for us and many of our peers in this marketplace.
We have a broad range of very loyal and contentive of clients who do need to continue to invest in technology to help them service their own clients. So, we’ve seen that resilience feed into our sales from September into December and also, we’ve been able to get to the work. Obviously, early in the pandemic, it was very difficult to get to site to deliver projects whereas during the autumn and early winter, we’ve been able to get to that work, get on site to deliver projects.
So, I think a combination of two things there.
Q3: Just talking about projects, you have a project called Fusion, can you just remind our viewers what that project is and how it’s progressing?
A2: Yes, that’s an internal project name but it’s been widely trailed. We have been a business that gather together, through acquisition, a number of different companies. When I joined AdEPT Technology just over two years ago, it was clear that we needed to bring the entire business together, whether that’s through one brand but also internally in terms of how we operate and run the business.
So, we’ve been implementing a common platform for use by the entire workforce whether that’s salespeople, people in the support teams, project engineers and right through to the accounting function. The mission is to have every run on that same platform so we can do two things really:
One, move work around the group. We’ve got a number of different offices across the group which we can now move work around the group to get it delivered by the most productive individuals.
Secondly, we get greater insight with what’s going on with the business which helps us optimise the productivity of the company.
So, two fundamental missions and we’ve made great progress.
Q3: Now, you touched on the pandemic earlier, a lot of people have had to change the way that they work, including schools. How has the company AdEPT education been helping?
A3: Education is a big part of our business, the schools that we service have been hugely affected by the impact of lockdown and one of their big challenges has been, not only working remotely, like in other companies, but also providing a service to pupils remotely through digital platforms. So, massive challenges facing their teachers and their leadership.
We’ve been doing some wonderful things and it’s been great hearing some of the feedback from those schools. Probably, the most important one is digitally enabling schools with the help of funding from the Department for Education.
So, we’ve helped over 5,000 schools move to the cloud, we’ve provided them with those digital platforms whether that’s Microsoft or Google and those schools are now able to teach remotely which has been a lifesaver over the last month, during this rather strange pandemic period.
Q4: Not only have you been helping schools but you’ve also helped transform part of the NHS, can you talk us through that?
A4: Obviously, you’re talking specifically around the Health and Social Care Network project which we’ve been delivering for well over two years now and we’ve announced success against that programme, at least the NHS has. They’ve announced success against that programme, saving several million pounds a year and also, speeding up the information flow throughout the NHS, through a high-speed network that connects the entire NHS estate.
We’ve been delivering that for a number of different organisation whether that’s care homes, whether that’s critical care hospitals or doctors surgeries and helping them get access to those high-speed connections.
We’ve delivered that now and we’re very pleased with the letter we received from the NHS earlier this year which basically said, ‘thanks for all your great work and the success of the programme’. So, always pleased to not only see the team win projects but really more importantly, to see those projects delivered and executed with a happy customer at the end of it.
It’s obviously why we do what we do.
Q5: Sounds like you’ve had a successful quarter, what should investors be looking out for in terms of news flow over the next quarter and beyond?
A5: I’m very proud of the business, my 300-person team have been working from kitchen tables, they’ve been struggling themselves with having children at home whilst they’ve not been able to go to school and I’ve been learning a lot about the personal lives of the surrounding individuals that work within the business. They’ve been incredibly dedicated to delivering for our customers so I think the quarter will show goods progress against our plan, despite the challenges of the pandemic.
In term of news flow, obviously we’ll close out our year at the end of March, our year-end is end of March so we’ll be putting out probably a brief trading update at that point to help investors understand where we are.
Beyond that, we have some good news that we’ll hopefully share over the next two or three months. I’d be very keen to start sharing some project success stories as well as sales wins with the investor community so look out for those.
We would love to be able to talk about acquisitions, obviously that’s a part of our DNA, we continue to look at the marketplace to see whether there’s any out there so hopefully at some point, we’ll be able to share news about that. Obviously, subject to many things going right.
I think, hopefully, good news on project delivery, a healthy update on the progress of the business and other significant news, we’ll keep you posted.
Q6: Phil, you’ve announced that there will be a Capital Market’s Day, can you tell us more about that?
A6: AdEPT Technology Group are running a Capital Market’s Day on the 9th of March and the theme is very much under the covers, getting beyond the numbers so three main aspects to that:
- We are sharing the story of London Grid for Learning which is a great relationship of ours that looks after several thousand schools, principally based in the London area. So, you’ll hear from the CEO of the London Grid for Learning business, a wonderful story there.
- We signed up a partner, 8×8 recently and our partners are crucial to our success, if we have fantastic partners and we marry those to market demand then we’ll be a successful business. We signed up 8×8 so we’ve got the European Vice President to talk about their experience with us and our experience with them.
- We are a consolidation vehicle, we acquire businesses so I thought investors might appreciate learning from the experiences of our most recent acquisition which was a company called ACS in Doncaster.
So, that’s the third leg of the Capital Market’s Day that we’re running on the 9th of March.