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Proactis Holdings

Proactis Holdings A profitable and cash generative period

Proactis Holdings PLC (LON: PHD), the business spend management solution provider, has announced its audited results for the financial year ended 31st July 2019.

Key Financial information:

Total contract value signed was £11.3m (2018: £12.1m), adding to future years’ revenue pipeline
· Reported revenues increased by 4% to £54.1m (2018: £52.2m)

· Annualised recurring revenue (“ARR”) maintained at £44.3m (2018: £44.5m)

· Adjusted EBITDA of £15.1m (2018: £17.3m), in line with expectations

· Impairment of £27.0m taken against US CGU as a result of the challenges in that market identified and announced during the Operational Review

· Adjusted EPS 6.6p (2018: 10.6p)

· Loss before tax £25.8m (2018: profit before tax £3.8m)

· Net bank debt reduced to £36.5m (31 January 2019: £39.3m)

· Net cash flow from operating activities £11.9m (2018: £8.4m)

Operational highlights:

  • Completed Operational Review in the period and implemented new strategic plan
  • Good level of new deals signed, with 60 new names added (2018: 64)
    Increased up-selling to existing customers with 127 deals secured (2018:113)
  • First sale completed by German commercial team during September 2019, demonstrating early success of recent restructuring and new strategic plan
  • Committed overdraft facility of £20m signed to support the delivery of the Group’s supplier paid accelerated payments solution, bePayd – which is now live.
  • Strengthened Board with appointment of Independent Non-Executive Director and CFO
  • Acquisition of Esize, a recognised territory leader in the Netherlands, has performed very well

Formal Sales Process (“FSP”)

· The Board has thoroughly reviewed and assessed the credibility of a number of expressions of interest (“EOIs”) following the Company’s announcement of the FSP on 29 July 2019. Certain EOIs have led to more advanced discussions including the provision of certain detailed financial information with regard to the business in a dataroom. The process remains ongoing. The Board reiterates that there can be no certainty that any offer will be forthcoming or the terms of any such offer.

Tim Sykes, Proactis Holdings CEO commented:

“The results for the period are in line with the Board’s expectations. Following the completion of the Operational review announced in April 2019, the management team has been working incredibly hard to assess and rectify the issues identified and that have impacted overall Group performance over the last two financial years. This has included managing leadership change throughout the regions affected as well as through the business as we build teams that are capable of executing the Group’s new go to market strategy. The Board is confident that this capability is now in place and the whole team can execute efficiently to deliver a substantial and high growth company. We are seeing relevant progress already with pipeline starting to build and an encouraging level of order intake in the new financial year.

“The Group has been profitable and cash generative in the period under review, and the long-term prospects are exciting. With a strong ARR giving high levels of visibility, and a proven, highly relevant end-to-end offering, we begin the new financial year in line with management’s expectations and with optimism for the Group’s potential.”

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