TIDMAPTD
RNS Number : 6076N
Aptitude Software Group PLC
24 January 2023
24 January 2023
Aptitude Software Group plc
("Aptitude" or the "Group")
Full Year Trading Update, Directorate Change and Notice of
Results
Aptitude, the specialist provider of finance digitalization and
subscription management software, today provides an update for the
financial year ended 31 December 2022 and the current financial
year together with details of a change to the Board.
Trading Update
Aptitude made strong progress in 2022, performing in line with
market expectations. In addition to several new business successes
the Group achieved a series of key milestones with Fynapse,
Aptitude's next generation digital finance platform.
These key milestones for Fynapse include:
-- the launch of the platform in the first half of the year,
followed by encouraging pipeline build;
-- the successful delivery of Fynapse to Aptitude's charter
client in the American telco market and their subsequent entry into
a multi-year subscription agreement; and
-- the signing of a multi-year global partnership agreement with
Microsoft to deeply integrate Fynapse with Microsoft Dynamics 365
Finance (for further information see
www.aptitudesoftware.com/news/)
The strategic global partnership with Microsoft, signed in
December, has the potential to be a material contributor to the
success of Fynapse globally in the medium and long term across all
industry sectors. The combination of Microsoft Dynamics 365 Finance
and Fynapse will provide Aptitude and Microsoft clients with the
ability to unify financial data from various systems to increase
scalability, gain the agility to rapidly adopt new regulations,
automate manual processes whilst delivering better business
insights and reducing the cost of the finance function.
Building on the new business successes announced earlier in the
year, the Group has secured several new major clients in the second
half of the year. These second half successes include:
-- Four new eSuite clients across multiple sectors demonstrating
the strength and breadth of the capabilities of the subscription
management platform brought into the Group in 2021;
-- A material new multi-year agreement for the Aptitude
Accounting Hub with one of the largest Australian banks to replace
their in-house finance data warehouse and underpin their finance
transformation programme; and
-- A multi-year agreement for AREV, Aptitude's leading revenue
management product, with a North American analytics software
provider
Benefitting from these successes, the Group's Annual Recurring
Revenue ('ARR') grew by 15% in the year to GBP51.6 million (31
December 2021: GBP45.0 million, 30 June 2022: GBP49.1 million). On
a Constant Currency basis ARR grew by 9% in the year with a
particularly strong performance from the Finance Digitalization
product set, underlining the strength of the long-term opportunity
for Fynapse.
The Group's balance sheet remains very strong. Following net
corporate cash outflows (dividends and loan payments) of GBP3.8
million in the year, cash at 31 December 2022 was GBP29.2 million
(31 December 2021: GBP29.1 million) and net funds of GBP15.9
million (31 December 2021: GBP16.1 million). Cash conversion was
below the prior year's exceptional performance with the collection
of some recurring revenue invoices extending into the new year.
Outlook
The Group has made good progress in 2022, achieving important
strategic milestones and new business successes across all regions
and across the existing product portfolio.
Notwithstanding this progress the Board is monitoring the wider
economic situation and its potential impact on our clients' and
prospects' procurement decisions. As ever, but particularly given
the current economic environment, the Board will continue to
carefully manage investment levels in the business, whilst
maintaining momentum on Fynapse and the Group's other strategic
priorities, to ensure profit expectations for 2023 are
unchanged.
The Group is confident that Fynapse will accelerate Aptitude's
growth in the medium and long term whilst also generating the
expected higher gross margins due to the cloud native technologies
on which the platform is built.
Board Change
The Board announces that Philip Wood, Deputy Chief Executive and
Chief Financial Officer, will be retiring from the Board in July
2023. Philip joined the Board in 2007 and after 16 years with the
Group is planning a career sabbatical to spend more time with his
young family. The Board is very grateful for his key role in
transforming the Group to focus on the Aptitude brand and the
expansion of the product range, laying the foundations for Fynapse
and the addition of revenue and subscription management.
As a result, the Board is pleased to announce that from today,
Mike Johns, currently Finance Director of the Group's business
outside of North America, will assume the role of Acting Chief
Financial Officer whilst a formal selection process is conducted.
Philip's financial responsibilities will now transfer to Mike with
Philip providing on-going handover support. Philip will continue
his responsibilities as Deputy Chief Executive Officer until his
departure in July.
Mike will be available to meet shareholders at the time of
Aptitude's preliminary results as part of the Group's results
roadshow.
Notice of Results
The Group expects to issue its results for the year ended 31
December 2022 on Tuesday, 21 March 2023.
A presentation for analysts will take place at 10.00 a.m. on the
day. Analysts wishing to attend should contact
aptitude@almapr.co.uk to register.
Aptitude Software Group plc
Ivan Martin, Chairman 020-3687-3200
Jeremy Suddards, Chief Executive Officer
Philip Wood, Deputy Chief Executive Officer
Mike Johns, Acting Chief Financial Officer
Alma PR
Caroline Forde / Hilary Buchanan 020-3405-0205
About Aptitude Software
Aptitude helps complex organizations automate and transform
their financial business models. Our core areas of focus are the
accelerating digitalization of the finance function, and the
cross-industry drive to deploy and manage subscription offerings.
Aptitude also continues to support clients through complex
regulations which often form the catalyst for broader finance
transformation.
Finance digitalization enables finance leaders to automate
manual processes, improve the speed of their function, enhance the
quality of its outcomes, and do so at a lower cost. Aptitude's
products draw data from complex, often siloed systems, automate its
processing through complex accounting calculations, and create a
unified view of finance. Businesses are left with a transparent
view of their data, delivered at extreme performance and at a lower
cost of ownership improving their finance functions' ability to
support their business objectives.
Subscription management is a rapidly increasingly critical
driver for new and traditional businesses alike, who need to launch
new offerings frequently, in ways which appeal to their customers
and allow them to outperform their peers. Aptitude's products power
the acquisition, monetization, and retention of subscribers
straight through to revenue reporting. With Aptitude, businesses
can take new subscriptions to market quickly, retain their
high-value recurring revenue, and stay one step ahead of the
competition. Whilst business to consumer (B2C) subscription models
are increasing all the time, Aptitude also specialises in business
to business (B2B) subscriptions which are undergoing significant
business model shifts post pandemic, increasing volume and
complexity to manage.
Our global client base includes some of the world's largest
companies, typically organisations with complex business models,
large volumes of data, and numerous internal systems. Aptitude is
headquartered in London, has a strong and growing North American
presence, and is powered by Global Innovation Centres in Poland and
the North West of England. Sales, support and implementation
services are provided from offices in the United States, the United
Kingdom, Canada, and Singapore. www.aptitudesoftware.com
Throughout this announcement:
(1) Annual Recurring Revenue ('ARR') is the value of Aptitude's
recurring revenue at a specific point in time, normalised to a
one-year period. ARR includes recurring revenues contracted but yet
to commence and excludes recurring revenues which are currently
being received but are known to be terminating in the future.
Included in ARR, for the first time, are recurring revenues from
the Group's solution management services, comparatives have been
adjusted to include such recurring revenue contracts.
2 Constant Currency is calculated by comparing the 2022 ARR at
31 December 2022 with 2021 position retranslated at the rates of
exchange prevailing at 31 December 2022.
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