TIDMINX

RNS Number : 1575N

i-nexus Global PLC

30 May 2022

30 May 2022

i-nexus Global plc

("i-nexus", the "Company" or the "Group")

Interim Results

i-nexus Global plc (AIM: INX), a leading provider of cloud-based Strategy Execution software solutions designed for the Global 5000, today provides its unaudited results for the 6 months ended 31 March 2022.

Financial Highlights

   --    New Monthly Recurring Revenue (MRR) improved at GBP23k (H1 2021: GBP8k) 
   --    Net Retention** of existing accounts for FY 2022 improved at 94% (FY 2021: 73%) 
   --    Group Revenue GBP1.54m (H1 2021: GBP2.01m) 

o Recurring revenue GBP1.42m (H1 2021: GBP1.81m)

o Services revenue GBP0.12m (H1 2021: GBP0.20m)

o This reduction in Recurring revenue reflects the exceptional level of churn experienced in FY21

   --    Gross margin relatively stable at 77% (H1 2021: 81%) 
   --    Adjusted EBITDA loss* of GBP0.14m (H1 2021: GBP0.12m) 
   --    Loss before tax GBP0.34m (H1 2021: GBP0.43m) 

-- Cash balance at 31 March 2022 improved at GBP0.69m (Cash and cash equivalents at 30 September 2021: GBP0.58m)

* Earnings before depreciation, amortisation, impairment, profit/loss on disposal of assets, share based payments and non-underlying items

** Net Retention is the % that closing MRR of existing accounts represents of the opening MRR of existing accounts

Operational Highlights and Outlook

-- The two key leading indicators above show an upward trend and have been at the center of our focus over the last 9 months following the worst impact of the pandemic

-- Sales momentum continued through the period, securing 5 contract wins and 2 upsells within existing accounts, with a combined FY22 MRR of GBP23k, a 10% gross increase on our opening position of GBP235k

-- The number of renewing customers increased significantly, contributing to a Net Retention rate of 94%, a considerable improvement on the prior year

-- Average deal size is increasing and we now have clear predictable conversion rates of leads into deals

   --    On track to deliver double digit net MRR growth in FY22 

-- Continued investment in our solution including new features designed to enhance the user experience

Simon Crowther, Chief Executive, of i-nexus Global plc, commented: "We are delighted to report that the increase in win rate experienced in Q4 has continued into the current year, reflecting the transformation we have effected within our sales and marketing approaches, combined with the increased industry recognition of the quality of our enterprise grade offering.

"The changes brought by the pandemic have highlighted the need for scalable, robust, digital strategy execution tools and the market for our software is growing. We will continue to invest in the capabilities of our offering, broadening the scope of our solutions while ensuring we consistently deliver high levels of customer satisfaction. The growth in our customer base and the steady increase in recurring revenues, means we look to the future with confidence."

For further information please contact:

 
 i-nexus Global plc                       Via: Alma PR 
  Simon Crowther, CEO 
  Alyson Levett, CFO 
 Singer Capital Markets (Nominated        Tel: +44 (0)207 496 
  Adviser and Broker)                      3000 
  Sandy Fraser / Alaina Wong (Corporate 
  Finance) 
  Tom Salvesen (Corporate Broking) 
 Alma PR                                  Tel: +44 (0)203 405 
  Caroline Forde                           0205 
 

About i-nexus Global plc

i-nexus Global plc ("i-nexus") helps organisations achieve their goals. Whether executing a strategy, driving operational excellence and continuous performance improvement, or coordinating portfolios and programs to transform results, i-nexus strategy execution software underpins success.

Today, we support organisations in managing over 200,000 strategic programmes around the world.

i-nexus transforms how organisations plan, execute, and track goals. We inspire the confidence to leave behind the spreadsheets, presentations and reports those organisations rely on, replacing it with a cloud-based, collaborative solution.

BUSINESS REVIEW

Overview

We are pleased to report on a period of encouraging trading, building on the investments made in our product offering and our sales and marketing approaches in the year to 30 September 2021. The sales successes in the period, the significant reduction in non-renewing existing accounts and the well verified opportunities in our sales pipeline, leaves us optimistic that we are on track to achieve double digit net MRR growth in the year.

Our aim over the last 12 months has been to re-build sales momentum in the business, and we believe results up to the date of this report provide evidence of our success in this regard. We are delivering a consistent volume of well verified sales leads each month. We have invested in our product, in response to customer feedback, in areas such as ease of use. This has been particularly useful in the sales process, allowing multiple trial implementations within the process, resulting in a much deeper engagement from prospects. While sales conversion and contracting in particular is still lengthy, both continue to progress.

Trading

We secured 5 new customers in the period (H1 FY21: 1) which along with the existing account upsells delivered a combined GBP23k MRR as noted above and a further 4 new customers are contracted at the time of the issue of this report, delivering a further combined value of GBP17k MRR. Each of these wins services limited business areas or teams within the customer and so each presents considerable expansion opportunities. On that theme, we expanded the use of our software within 3 existing accounts (H1 FY21: 1) including within one new account within the first few months of use of the platform. We continue to have several live trial implementations at multiple enterprises across the US, UK and Europe and an ongoing paid Pilot with a major technology company.

Fundamental to these successes has been our increased understanding of where we sit within the competitive market landscape. We are now clearer on our differentiators and confident our platform is the best in class to support enterprise level strategy execution - a view confirmed to us by our prospects.

We continue to be careful with our investment in the business and are conscious of the increased need to be prudent in the face of rising costs. Many of our contracts allow for an annual fee increase after the initial term and we will seek to strengthen such options as we progress this year.

Market opportunity

All businesses set goals, plan how to deliver them and track performance. The challenge is if they can do this at pace, with insight and high levels of visibility across their complex operating environment. In most cases the answer to this is no and this is where i-nexus' software delivers considerable value.

Our software category - Strategy Execution Management (SEM) - continues to evolve and gain momentum as companies accelerate digitising mission-critical processes in this post pandemic world. Faced with market uncertainty, this "new normal" future requires companies to increase responsiveness by dynamically managing their strategic plan; something that we believe simply cannot be achieved in spreadsheets and other conventional productivity tools.

The growing importance of the SEM market has been acknowledged by leading analysts including Gartner Research, with SEM now considered an integral part of the new Strategy Portfolio Management (SPM) software category.

We are seeing an increased sophistication in our market, with prospects frequently now coming to us with very well thought through capability requirements, having pre-evaluated i-nexus against the competition on a matrix of criteria. We continue to see that i-nexus has two clear advantages in strategy execution against SPM vendors: powerful strategic planning and performance management capabilities that complement portfolio management features. Plus, i-nexus' customers benefit from insight gained from over fifteen years of market experience in strategy execution.

People

We have a talented, committed team at i-nexus, all pulling in the same direction and now delivering results. The Board would like to once again thank them all for their commitment.

We announced in May that our longstanding CFO, Alyson Levett will be stepping down from the Board in August to pursue a portfolio career. In the near term, Ms. Levett will remain available to i-nexus in an advisory role to ensure an orderly hand over. The Board are incredibly grateful for the tireless work and huge personal commitment that Alyson has put into ensuring the financial stability of i-nexus. She leaves the business on a sound financial footing, and we wish her all the very best in her future endeavours. We are delighted to have found an exceptional CFO to take up the role, Drew Whibley, joining us from his role as Group Finance Manager at LSE listed software business Aptitude Software Group plc. We look forward to working with him, as we look to continue the positive progress we have been making in recent months.

Strategic Focus for H2

Our strategy is focused on four main programmes of work:

   --    winning more logos; 

-- keeping our customers through increased end user satisfaction and helping our sponsors demonstrate value to their executives;

   --    hiring the right people as we grow; 

-- a focus on how to continue to evolve the capabilities of our platform, a market product study has begun to explore this.

We believe through continued focus on these areas, we will drive the success of the business.

Current Trading and Outlook

Following the sales successes in the period and those at the start of H2, the Company's committed Monthly Recurring Revenue rate will increase to GBP245k and we remain on track to deliver our target of double digit MRR growth in the year. We are managing the impacts of cost inflation on the business and have clear visibility of our cash runway.

The changes brought by the pandemic have highlighted the need for scalable, robust, digital strategy execution tools and the market for our software is growing. We will continue to invest in the capabilities of our offering, broadening the scope of our solutions while ensuring we consistently deliver high levels of customer satisfaction. The growth in our customer base and growth in MRR, means we look to the future with confidence.

FINANCIAL REVIEW

Reported revenue

As identified above there are 2 positive forward looking metrics that leave the Board optimistic about the Company's future potential:

   --    New MRR from deals closed in the period 
   --    Net Retention rate 

Adverse exchange rate movements and other non-trade related adjustments have led to a reduction in MRR of some GBP8k (H1 21: GBP2k). However more recent events and trading performance mean the impact of these in H2 22 is expected to be less adverse.

Double-digit net MRR growth is expected in FY22 which compares very favourably to FY21 where the equivalent value was a net reduction in MRR of approximately 23%.

Total recognised revenue for FY22 is however expected to be below FY21 as this net reduction in MRR in FY21 has an adverse impact on this Financial Year's recognisable revenue.

Total recognised revenue decreased to GBP1.54m (H1 21: GBP2.01m) which reflects the exceptional level of churn experienced in FY21. As a result, revenue from recurring contracted software subscriptions reduced by 22% to GBP1.42m (H1 21: GBP1.81m). Revenue from professional services reduced by 40% to GBP0.12m (H1 21: GBP0.20m).

The Group signed five new customers (H1 21: one) under a recurring contract paid annually in advance during the period and a further four in early H2 which were delayed in contracting from H1. Due to our subscription revenue model, the majority of revenue from these contracts will be recognised in future periods. The timing of the new customer orders and existing client change orders resulted in lower levels of WIP for the service team to deliver in the period, however an increase in both towards the end of the H1 will contribute to better revenue results in H2.

Gross margin

Gross margin in the period remained relatively stable at 77% (H1 21: 81%). Reported gross margin is the blended gross margin over both recurring software subscriptions and professional services.

Overheads

Overheads (defined as the aggregate of staff costs and other operating expenses but excluding those costs included in cost of sales) reduced in the period by GBP0.59m to GBP1.42m (H1 21: GBP2.01m) reflecting the full impact of the cost control initiatives undertaken last year. As we see our new business and change orders increasing, we have started a select number of investments in additional resource needed for operational delivery.

The Group's underlying cost base averaged approximately GBP0.27m per month for H1. This level should have delivered net break-even EBITDA, but the timing of new deals and the low services WIP led to lower recognised revenue than Budgeted and meant we made a modest adjusted EBITDA loss of GBP0.14m (H1 21: GBP0.12m).

Capitalised development costs amounted to GBP0.08m in the period (H1 21: GBP0.20m). We expect to see an increase in this in H2 as we look to add more new features.

The Group's Operating loss has reduced as a result of last year's cost control exercise to GBP0.23m (H1 21: GBP0.36m).

Cash flow

Cash and cash equivalents closed at GBP0.69m (H1 21: GBP0.81m). This result reflects a strong renewal performance, good cost control and a good new deal and change order billing performance especially towards the end of H1 and is in line with management expectations.

Borrowings at 31 March 2022 were GBP0.05m (31 March 2021: GBP0.24m) reflecting the full repayment of the Boost debt. The remaining balance is an HSBC BBLS loan of which GBP0.01m is payable within one year.

Convertible debt liability stood at GBP1.84m at 31 March 2022 (31 March 2021: GBP1.35m) excluding accrued interest of GBP0.14m (31 March 2021: GBP0.06m).

The Group will continue to apply treasury and foreign currency exposure management policies to minimise both the cost of finance and our exposure to foreign currency exchange rate fluctuations.

i-nexus Global plc

Group Statement of Comprehensive Income

 
 
                                 Unaudited       Unaudited         Audited Year 
                                 Six months      Six months      ended 30 September 
                                  ended 31     ended 31 March           2021 
                                 March 2022         2021 
 
 
                                        GBP               GBP                   GBP 
 Revenue                          1,540,267         2,013,472             3,639,111 
 Cost of Sales                    (351,892)         (383,829)             (635,532) 
 Gross Profit                     1,188,375         1,629,643             3,003,579 
 Other operating income                   -            25,426                88,316 
 Administrative Expenses        (1,418,905)       (2,012,829)           (4,062,295) 
 Operating Loss                   (230,530)         (357,760)             (970,400) 
 Investment revenues                     11                 5                    65 
 Financing Costs                  (112,575)          (69,001)             (162,855) 
 Loss before tax                  (343,094)         (426,756)           (1,133,190) 
 Tax                                 60,391           197,815               398,258 
 Loss for the period/year         (282,703)         (228,941)             (734,932) 
 
 Other comprehensive 
  income: 
  Items that will not 
  be reclassified to profit 
  or loss 
 Exchange differences 
  arising on translation 
  of foreign operations              38,884            86,309                17,346 
 Total other comprehensive 
  income for the period/year         38,884            86,309                17,346 
 Total Comprehensive 
  income for the period/year      (243,819)         (142,632)             (717,586) 
 
                                        GBP               GBP                   GBP 
 Basic and diluted earnings 
  per share                         (0.010)           (0.008)               (0.025) 
 
 Adjusted EBITDA                  (137,552)         (118,255)             (256,873) 
 Depreciation, amortisation, 
  impairment and profit/loss 
  on disposal                      (88,666)         (154,166)             (551,862) 
 Share based payment 
  expenses                          (4,312)                 -              (17,181) 
 Non-underlying items                                (85,339)             (144,484) 
 Operating Loss                   (230,530)         (357,760)             (970,400) 
-----------------------------  ------------  ----------------  -------------------- 
 

Group Statement of Financial Position

 
                                       Unaudited        Unaudited        Audited 
                                                                        As at 30 
                                  As at 31 March   As at 31 March      September 
                                            2022             2021           2021 
                                             GBP              GBP            GBP 
 Assets 
 Non-current assets 
 Intangible assets                     1,120,015        1,321,613      1,099,313 
 Property plant and equipment             40,919          108,647         67,111 
 Total non-current assets              1,160,934        1,430,260      1,166,424 
 
 Current assets 
 Trade and other receivables           1,245,602        1,107,449        791,948 
 Current tax recoverable                  50,000           75,000        275,000 
 Cash and cash equivalents               694,202          811,768        575,203 
 Total current assets                  1,989,804        1,994,217      1,642,151 
 
 Total assets                          3,150,738        3,424,477      2,808,575 
 
 Current liabilities 
 Borrowings                                9,586          156,513         71,425 
 Trade and other payables                866,349          628,558        952,157 
 Deferred income                       1,655,075        1,998,387      1,030,315 
 Total current liabilities             2,531,010        2,783,458      2,053,897 
 
 Non-current liabilities 
 Trade and other payables                140,310                -         88,330 
 Borrowings                               37,271           80,208         42,094 
 Convertible loan notes                1,839,858        1,350,000      1,782,458 
 Provisions                                    -           30,000              - 
 Total non-current liabilities         2,017,439        1,460,208      1,912,882 
 Total liabilities                     4,548,449        4,243,666      3,966,779 
-------------------------------  ---------------  ---------------  ------------- 
 Net liabilities                     (1,397,711)        (819,189)    (1,158,204) 
-------------------------------  ---------------  ---------------  ------------- 
 
 Equity 
 Called up share capital               2,957,161        2,957,161      2,957,161 
 Share premium account                 7,256,188        7,256,188      7,256,188 
 Equity reserve                          231,851                -        231,851 
 Share option reserve                     17,301           13,093         12,989 
 Foreign exchange reserve                 40,760           70,839          1,876 
 Merger reserve                       10,653,881       10,653,881     10,653,881 
 Retained earnings                  (22,554,853)     (21,770,351)   (22,272,150) 
 Total Equity                        (1,397,711)        (819,189)    (1,158,204) 
-------------------------------  ---------------  ---------------  ------------- 
 

Group Statement of Cash Flows

 
                                             Unaudited   Unaudited       Audited 
                                              As at 31    As at 31      As at 30 
                                                 March       March     September 
                                                  2022        2021          2021 
                                                   GBP         GBP           GBP 
 Cash flows from operating activities 
 Loss after taxation                         (282,703)   (228,941)     (734,932) 
 Taxation credit                              (60,391)   (197,815)     (398,258) 
 Loss before taxation                        (343,094)   (426,756)   (1,133,190) 
 
 Adjustments for non-cash/non-operating 
  items 
 Amortisation, depreciation, impairment 
  of intangible and profit on disposal          88,666     154,166       551,862 
  Share based payment                            4,312      13,093        17,181 
  Finance income                                  (11)         (5)          (65) 
  Finance charges                              112,575      69,001       162,855 
                                             (137,552)   (190,501)     (401,357) 
 
 Changes in working capital: 
 (Increase)/Decrease in trade and 
  other receivables                          (453,654)   (274,942)        78,059 
 (Decrease) in provisions                            -    (50,702)      (80,702) 
 Increase/(Decrease) in trade and 
  other payables                               538,951   (336,324)     (980,799) 
 Taxation                                      285,392     422,815       423,258 
 Net cash from operating activities            233,137   (429,654)     (961,541) 
 
 Cash flows from/(used in) investing 
  activities 
 Purchase of property, plant and 
  equipment                                    (3,177)       (330)       (1,171) 
 Purchase of development costs                (80,000)   (201,325)     (335,446) 
 Proceeds on disposal of property, 
  plant and equipment                                                      1,180 
 Interest received                                  11           5            65 
 Net cashflow from/used in investing 
  activities                                  (83,166)   (201,650)     (335,372) 
 
 Cash flows from/(used in) financing 
  activities 
 Principle elements of lease costs                   -    (37,467)      (37,467) 
 Funds raised 
 Issue of convertible loans                          -   1,375,000     1,937,500 
 Proceeds from borrowings                                                 50,000 
 Repayment of borrowings                      (66,662)    (86,988)     (179,981) 
 Interest paid                                 (3,194)    (13,793)      (35,216) 
 Net cash flow from/used in financing 
  activities                                  (69,856)   1,236,752     1,734,836 
 
 Net increase in cash and cash 
  equivalents                                   80,115     605,448       437,923 
 Cash and cash equivalents beginning 
  of the period                                575,203     120,011       120,011 
 Effect of foreign exchange rate 
  changes                                       38,884      86,309        17,269 
 Cash and cash equivalents at the 
  end of the period                            694,202     811,768       575,203 
 
 

Group Statement of Changes in Equity

 
                                                                                                                                     Share                  Foreign 
                                            Share                   Share                          Equity                           option                 exchange                      Merger                  Accumulated                           Total 
                                          Capital                 Premium                         Reserve                          Reserve                  reserve                     reserve                       losses                          Equity 
                                              GBP                     GBP                             GBP                              GBP                      GBP                         GBP                          GBP                             GBP 
 
  As at 1 October 2020                  2,957,161               7,256,188                               -                                -                 (15,470)                  10,653,881                 (21,541,410)                       (689,650) 
 
  Loss for period                               -                       -                               -                                -                        -                           -                    (228,941)                       (228,941) 
           Exchange 
            differences 
            on 
 HY         foreign 
  FY2021    operations                          -                       -                               -                                -                   86,309                           -                            -                          86,309 
 
  Share option expense in 
   the period                                   -                       -                               -                           13,093                        -                           -                            -                          13,093 
 
  As at 30 March 2021                   2,957,161               7,256,188                               -                           13,093                   70,839                  10,653,881                 (21,770,351)                       (819,189) 
 ------------------------  ----------------------  ----------------------  ------------------------------  -------------------------------  -----------------------  --------------------------  ---------------------------  ------------------------------ 
  As at 1 October 2020                  2,957,161               7,256,188                               -                                -                 (15,470)                  10,653,881                 (21,541,410)                       (689,650) 
  Loss for period                               -                       -                               -                                -                        -                           -                    (734,932)                       (734,932) 
 
           Other 
           Comprehensive 
           income: 
  Exchange differences on 
   foreign operations                           -                       -                               -                                -                   17,346                           -                            -                          17,346 
 FY2021 
  Total comprehensive 
   income 
   for the year                                 -                       -                               -                                -                   17,346                           -                    (734,932)                       (717,586) 
  Share option expense in 
   the year                                     -                       -                               -                           17,181                        -                           -                            -                          17,181 
 
  Share options cancelled                       -                       -                               -                          (4,192)                        -                           -                        4,192                               - 
 
  Issue of convertible 
   loan                                         -                       -                         231,851                                -                        -                           -                            -                         231,851 
 
  Balance at 30 September 
   2021                                 2,957,161               7,256,188                         231,851                           12,989                    1,876                  10,653,881                 (22,272,150)                     (1,158,204) 
 
  As at 1 October 2021                  2,957,161               7,256,188                         231,851                           12,989                    1,876                  10,653,881                 (22,272,150)                     (1,158,204) 
 
  Loss for the period                           -                       -                               -                                -                        -                           -                    (282,703)                       (282,703) 
 
           Other 
           comprehensive 
           income: 
           Exchange 
            differences 
            on 
 HY         foreign 
  FY2022    operations                          -                       -                               -                                -                   38,884                           -                            -                          38,884 
 
  Total comprehensive 
   income 
   for the year                         2,957,161               7,256,188                         231,851                           12,989                   40,760                  10,653,881                    (282,703)                       (243,819) 
 
  Share options expense 
   in the period                                -                       -                               -                            4,312                        -                           -                            -                           4,312 
 
  Balance at 31 March 
   2022                                 2,957,161               7,256,188                         231,851                           17,301                   40,760                  10,653,881                 (22,554,853)                     (1,397,711) 
 ------------------------  ----------------------  ----------------------  ------------------------------  -------------------------------  -----------------------  --------------------------  ---------------------------  ------------------------------ 
 

Notes to the consolidated interim report

For the six months ended 31 March 2022

   1.    General information 

i-nexus Global plc (the "Company") is a public limited company domiciled in the UK and incorporated in England and Wales (registered number 11321642 ) and its registered office is 27-28 Eastcastle Street, London, W1W 8DH.

The principal activity of i-nexus Global plc ("the Company") and its subsidiary companies, i-solutions Global Limited and i-nexus (America) Inc. (together "i-nexus Global" or "the Group") is the development and sale of Enterprise Cloud based software and associated professional Consultancy services.

The interim condensed consolidated financial statements were approved for issue on 27 May 2022.

   2.    Basis of preparation 

This unaudited interim condensed consolidated financial information has been prepared under the historical cost convention and in accordance with AIM Rules for Companies. The interim condensed consolidated financial information has been prepared on a going concern basis and is presented in Sterling to the nearest GBP1.

The Directors have at the time of approving the Interim financial statements, a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Thus, the Directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Forecasts are adjusted for reasonable sensitivities that address the principal risks and uncertainties to which the Group is exposed, thus creating a number of different scenarios for the Board to challenge. On the basis of this analysis, the Board has concluded that there is a reasonable expectation that the Group will have adequate resources to continue in operational existence for the foreseeable future being a period of at least twelve months from the date of approval of this report.

The accounting policies used in the preparation of the interim condensed consolidated financial information are consistent with those set out in the 2021 Annual Report and Accounts. The Group will continue to review its accounting policies in the light of emerging standards and industry consensus on the practical application of IFRS.

The preparation of financial information in conformity with IFRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial information and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management's best knowledge of the events or actions involved, actual outturns ultimately may differ from those estimates. The interim information does not include all financial risk management information and disclosures required in annual financial statements; the information should be read in conjunction with the financial information, as at 30 September 2021, summarised in the 2021 Annual Report and Accounts. Section 6 below summarises the most relevant of these.

The interim condensed consolidated financial information for the six months ended 31 March 2022 and for the six months ended 31 March 2021 do not constitute statutory accounts as defined in Section 434 of the Companies Act 2006 and are unaudited. The financial information for the six months ended 31 March 2022 presents financial information for the consolidated group, including the financial results of the Company's wholly owned subsidiaries, i-solutions Global Limited and i-nexus (America) Inc. Comparative figures in the Interim Report for the year ended 30 September 2021 have been taken from the Group's audited financial statements on which the Group's auditors, Saffery Champness LLP, expressed an unmodified opinion.

   3.    Segmental reporting 

The Directors consider that there is one identifiable business segment that is engaged in providing individual products or services or a group of related products and services that comprise the core business.

All of the Group's assets and operations are located in the UK and USA.

   4.    Earnings per share 

The calculation of basic and diluted loss per share for the six months to 31 March 2022 was based upon the loss attributable to ordinary shareholders of GBP282,703 (six months to 31 March 2021: GBP228,941, year ended 30 September 2021: GBP734,932) and a weighted average number of ordinary shares in issue of 29,571,605 (six months to 31 March 2021: 29,571,605, year ended 30 September 2021: 29,571,605), calculated as follows:

Weighted average number of ordinary shares

 
                     Six months   Six months           Year 
                          ended        ended          ended 
                       31 March     31 March   30 September 
                           2022         2021           2021 
                                              ------------- 
 Loss for 
  the period 
  attributable 
  to equity 
  holders of 
  the Company         (282,703)    (228,941)      (734,932) 
------------------  -----------  -----------  ------------- 
 Issued ordinary 
  shares at 
  start of 
  period/year        29,571,605   29,571,605     29,571,605 
 
   Weighted 
   average number 
   of shares 
   at end of 
   period/year       29,571,605   29,571,605     29,571,605 
------------------  -----------  -----------  ------------- 
 

Earnings per share 0.010 0.008 0.025

   5.    Availability of Interim Report 

Electronic copies of this Interim Report will be available on the Group's website at www.i-nexus.com.

   6.    Principal risks and uncertainties 

Although the directors seek to minimise the impact of risk factors, the Group is subject to a number of such factors. Those most relevant to the Group's performance in H2 are as follows:

Working capital

Whilst the Directors believe that the injection of funds from the convertible bond issues last year has provided exibility to satisfy the Group's near-term funding requirements, there can be no guarantee as to the Group's longer term working capital requirements and, therefore, the Group may need to seek additional capital over and above that raised from the issue of the Convertible Loan Notes. No assurance can be given as to the availability of such additional capital at any future time or, the terms upon which such additional capital would be available.

The Group's continuing viability in the longer term remains dependent on its ability to secure new sales to existing and potential customers. The Group prepares regular business forecasts and monitors its projected cash flows, which are reviewed by the Board. The scenarios and sensitivities demonstrate that there are actions management can implement should the plans not deliver the growth hoped for.

Customer churn

The Group has experienced falling revenues in relation to certain customers in the past and in H1, albeit to a lesser extent. The reasons for this are varied and the Group's historical ability to invest in its customers was limited. While the investment in customer retention activities is seeing benefits, customer churn is still a risk for the Group and could affect the Group's trading and financial position and prospects.

Implementation of Growth Strategy

Failure to successfully implement its growth strategies. The Board recognises that executing the Group's strategy may be di cult to implement/achieve and may not be as successful as planned. Pressure on management, limitations on operational and nancial resources, the potential insu ciency of demand for the Group's products and a slower than anticipated market acceptance of the Group's products could lead to failure to successfully implement its strategies and so adversely a ect the Group's reputation, prospects, results of operations, and its nancial condition.

Digitalising Strategy Execution

Failure of the market to accept the need/urgency to digitalise their Strategy Execution (SE). A large proportion of the Group's target market continues to use traditional methods and in-house developed systems to assist in their SE. The Board believes the market needs further education in the bene ts of digitalising SE. Potential customers may prefer to "do nothing" and be unnecessarily cautious about investing in the Group's software. Failure by the Group to adequately explain the value proposition to increase the market's readiness to accept the technology will lead to slower than projected growth. The Groups marketing function supported by a network of consulting partners work with potential customers to educate them on the benefits the product can offer. Furthermore the impact of COVID-19 is making the need to digitise strategy more widely accepted.

Account Proliferation

Failure of our existing accounts to grow, resulting from dissatisfaction with the product and/or deployment issues. An important aspect of the Group's growth strategy is to proliferate sales of its i-nexus software with existing customers as a result of the natural evolution of the software use over time. Although the Group has a number of examples where this has occurred in the past, this is no guarantee that it will continue to happen at the increasing rate predicted. Any failure of this anticipated account proliferation to happen will a ect the Group's future success and adversely a ect its business, prospects and results of operations and nancial position. The Group's investment in its Success team and the work undertaken by its development team to implement feedback received from clients are designed to mitigate this risk wherever possible.

   7.    Forward-looking statements 

This announcement may include certain forward-looking statements, beliefs or opinions, including statements with respect to the Group's business, financial condition and results of operations. These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "anticipates", "targets", "aims", "continues", "expects", "intends", "hopes", "may", "will", "would", "could" or "should" or, in each case, their negative or other various or comparable terminology. These statements are made by the Directors in good faith based on the information available to them at the date of this announcement and reflect the Directors beliefs and expectations. By their nature these statements involve risk and uncertainty because they relate to events and depend on circumstances that may or may not occur in the future. A number of factors could cause actual results and developments to differ materially from those expressed or implied by the forward-looking statements, including, without limitation, developments in the global economy, changes in government policies, spending and procurement methodologies, and failure in health, safety or environmental policies. No representation or warranty is made that any of these statements or forecasts will come to pass or that any forecast results will be achieved. Forward-looking statements speak only as at the date of this announcement and the Group and its advisers expressly disclaim any obligations or undertaking to release any update of, or revisions to, any forward-looking statements in this announcement. No statement in the announcement is intended to be, or intended to be construed as, a profit forecast or to be interpreted to mean that earnings per share for the current or future financial years will necessarily match or exceed the historical earnings. As a result, you are cautioned not to place any undue reliance on such forward-looking statements.

   8.    Statement of Directors' Responsibilities 

The Directors confirm to the best of their knowledge that:

i) The condensed interim financial information has been prepared in accordance with IAS 34 as adopted by the European Union; and

ii) The interim management report includes a fair review of the information required by the FCA's Disclosure and Transparency Rules (4.2.7 R and 4.2.8 R).

Financial statements are published on the Group's website in accordance with legislation in the United Kingdom governing the preparation and dissemination of financial statements, which may vary from legislation in other jurisdictions. The maintenance and integrity of the Group's website is the responsibility of the Directors. The Directors' responsibility also extends to the ongoing integrity of the financial statements contained therein.

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END

IR SEDSAAEESELI

(END) Dow Jones Newswires

May 30, 2022 02:01 ET (06:01 GMT)

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