# Proactis Holdings Plc Q&A with CFO Tim Sykes: Latest Trading Statement (LON:PHD)

- Link: https://www.directorstalkinterviews.com/proactis-holdings-plc-qa-cfo-tim-sykes-latest-trading-statement-lonphd/412724438
- Published: 2017-02-23T12:25:40+00:00
- Author: Amilia Stone

**Proactis Holdings Plc** ([LON:PHD](https://www.directorstalkinterviews.com/company/proactis-holdings-plc/phd.l))
Chief Financial Officer Tim Sykes caught up with DirectorsTalk for an exclusive 
interview to discuss their latest trading statement, the performance of Millstream,
the supplier commerce initiative and summarises Proactis’ delivery within the short
period against the longer-term story

 

**Q1: Proactis Holdings appears to be doing well with 36% year-on-year revenue growth,
what are the key drivers of that growth?**

**A1**: We’re delighted with the progress that we’ve made this 6 months. So, there
are three key drivers to the growth we’ve been able to demonstrate, first one is
our organic growth from our core businesses and the second one is the contribution
from our acquisitions. So, it’s absolutely key to remember that our underpinning
foundation is strong organic business so it’s really important to see that growth
coming through in the figures at 13.4% but we’re a twin-storied company so the contribution
from our acquisitions is also very important and really encouraging. Millstream,
which was acquired during November 2016, and also Due North, which was acquired 
during February 2016, both represent new revenues to us for this period and both
were contributing well and in line with our expectations.

 

**Q2: You refer to the performance of Millstream specifically, it’s your fifth acquisition
in 4 years, could you elaborate a little bit further?**

**A2**: The financial performance of Millstream is really critical to our plans 
and we paid £15.5 million for that in November last year. So, we were hoping, when
we bought it, for just short of £5 million per annum in revenue and just short of
£2 million per annum on EBITDA so it’s great to see that coming through post-acquisition
and we’ve tried to show to investors and the investment community how that business
is going in the early days under our stewardship. So, we took a decision to integrate
minimally in the early phase of our ownership to give it the opportunity to bed 
in properly with minimal disruption and we’ll move further forward with fuller integration
in the coming months so really pleased with the early stage progress that it’s made
inside of our group.

 

**Q3: Now, an element of the upside to the Proactis story is the supplier commerce
initiative, can you give us an update on the progress there?**

**A3**: Of course, so this is a really exciting upside to our story, on the base
plan of our organic growth in our businesses and our M&A story and it’s really important
to understand that we’re bringing a new product, or a new concept, to market here
and this takes time so, it’s frustratingly time-consuming but we believe that we’re
truly be very valuable in the future. So, we established a small group of early 
adopters for the concept, made about a year or so ago now, and envisaged the period
from about 6 months of about a year, we said that estimated between 3 months and
12 months, to transition to develop the concept into a product which we could then
take more widely into our customer base. So, we’re in that transition period now
and we’re gathering really important data and information about buyer behaviour 
and about supplier reaction to what we’re trying to achieves so that we can be prepared
for that wider roll out down the line. In addition to the acquisition of Millstream,
and their business model, the supplier commerce opportunities have widened considerably
and we’re looking at ways we can deploy the technology within our own operations
as well as into our customers.

 

**Q4: More generally then, can you summarise Proactis Holdings’ delivery within 
the short period against the longer-term story?**

**A4**: Yes, it’s important to understand where we are in our 6 months versus our
longer-term plan. We have a well-established strategy to deliver growth to three
core areas so organic, new names in our core businesses and then upselling and cross-
selling into the customer base is our foundation. Earnings enhancing M&A activity,
so things like Due North in February ’16 and then Millstream in November ’16, adding
to the three acquisitions from before and then number three, as just described, 
supply and commerce. That strategy has been set now for over 4 years and is still
really an absolutely valid so we’re simply executing to that strategy in this 6-
month time and continue to do that over the course of the next 6 months and into
the future years.

 

###### _Proactis Holdings Plc (LON:PHD) is a United Kingdom-based company, which is a Spend control and e-Procurement solution provider. The Company is engaged in the development and sale of business software, installation and related services. It offers a range of solutions, such as PROACTIS Source-to-Contract, PROACTIS Purchase-to-Pay and PROACTIS Supplier Network solutions._

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