dotDigital Group PLC

FINAL RESULTS FOR THE YEAR ENDED 30 JUNE 2016

FINAL RESULTS FOR THE YEAR ENDED 30 JUNE 2016

“Strong organic growth and continued international expansion”

dotdigital Group Plc (AIM:DOTD), the leading provider of intuitive software as a service (“SaaS”) and managed services to digital marketing professionals is pleased to announce its Final Results for the year ended 30 June 2016.

2016 Highlights

Key performance indicators

  • Turnover increased by 26% to £26.9m (2015: £21.4m)
  • EBITDA of £8.0m, up 17% (2015: £6.8m)
  • Strong cash position of £17.3m at year end (2015: £11.9m)
  • Net assets of £23.7m, up 29% (2015: £18.4m)
  • EPS up 12% to 1.83p (2015: 1.63p)
  • Recurring revenues of 78% (2015: 76%)
  • Volumes of emails sent 8.6bn (2015: 6.2bn)
  • International growth of 18% (2015: 14%)
  • Announced today: Final Dividend proposed of 0.84p per ordinary share (2015: 0.36p), comprised of an ordinary dividend of 0.43p (2015: 0.36p) and a special dividend of 0.41p (2015: nil) – see separate announcement

International growth

EMEA : Europe, Middle East & Africa

  • UK revenues grew 21% to £22.0m (2015: 18.3m)
    • Over £4m of revenues – up 106% – attributable to increased revenues generated by existing client upselling to new advanced feature adoption
    • Average monthly spend per client rose by approximately 29% to circa. £575
    • Professional services offering up from £2.8m to £3.1m with gross margins of 60%
  • Good progress in South Africa and Middle East with high value clients signed in period
  • Good initial traction has been achieved within the Nordics, Benelux and Netherlands through the Magento Partnership

US

  • Revenues from the US increased from US$3.0m to US$4.4m, an increase of 43%
  • New York office to be main hub across US
  • Slow start but recent new hires in sales and business development expected to drive future growth in region
  • Alongside the Magento Partnership, new CRM sales initiatives started with Salesforce & MS Dynamics

AsiaPac

  • Initial hub in Sydney, Australia with revenues of $0.6m AUS in first 12 months
  • Indirect sales model through Magento Connector and new Partnerships now being signed albeit slower than planned due primarily to these trusted new relationships taking longer to be established
  • Good progress now being made to span more broadly from Australia into AsiaPac region with opportunities to integrate the dotmailer platform via a direct sales team approach
  • Strong pipeline building

Magento connector

  • dotmailer named exclusive Global premier partner for its Magentor Connector
  • Average monthly recurring revenue spend has grown by 25% to approximately £1,300 per month
  • Magento Version 2.1 has now been released which has started to see a good client pipeline emerge in all regions across the world

New clients

  • Notable client wins across UK and international in the B2B and B2C sectors include: Vogue UK, Handelsbanken, Saville Group, Dune, Hawes and Curtis, Paul Smith, Eurostar International, Osprey Europe, Edcon, Mr Price and Sol Lingerie

H1 Outlook

  • Uncertain macro environment continually being assessed by the Board
  • Revenue growth in Q1 over 20%
  • Larger monthly spend commit from clients
  • Strong uptake of CRM connectors
  • Early signs promising for Benelux, Nordics and South Africa markets

Announced Today: Company Secretary Change

  • George Kasparian, dotdigital’s Non-Board Finance Director, takes over the Company Secretary role from Milan Patel, CEO, with immediate effect

Commenting on the final results and outlook, Milan Patel, Chief Executive Officer, said:

“2016 was a year of continued strong organic, profitable growth for dotdigital. For 2017, our approach will be further refinement of the partner programme and developing the strategic partnerships, global expansion into the EMEA, North America and Asia Pacific regions through self-service and direct sales teams and to continue building new integrations into more ecommerce and CRM platforms that focus on the mid-market and small enterprise space.

The Board believes that the dotmailer platform, with its ease-of-use proposition, deep integrations, professional services, growing list of global partners and its scalability, is well placed to continue to generate strong organic growth not only from the markets it currently operates in today but wider into the global markets it is looking to enter.”

Read the full announcement here