Ideagen, developers of quality, safety, audit, performance and risk management software, is pleased to announce that it expects revenues to exceed £27 million for the year ended 30th April 2017 - it's 8th consecutive year of growth.
In the company's pre-close trading update, published today, it revealed that revenue would be approximately £27.1 million, a rise from £21.9 million in 2016.
Ahead of Ideagen's official end of year results announcement in July, the company reported that results were expected to be in line with market expectations. Trading was once again robust across all key verticals with particular success in the Life Science, Aviation and Financial sectors.
David Hornsby, Ideagen's CEO, said the company's strong performance was "underpinned by strong cash generation".
He added: "We are pleased to report that the Group has continued to perform well in delivering another year of high quality earnings growth, underpinned by strong cash generation.
"We have also made four important acquisitions which have provided scale, product capability and recurring revenues. The company continues to grow organically and to increase the percentage of our revenues derived from recurring business.
"The Group has significant contracted work in progress and a strong pipeline of new business opportunities which provides the Board with confidence for the current year and beyond."
In the year to 30th April 2017, Ideagen delivered organic revenue growth* of approximately 10% together with further contributions from all four acquisitions made during the year, which represents the Group's eighth consecutive year of revenue and adjusted EBITDA** growth.
As well as revenue rises expected in Ideagen's official end of year trading results, scheduled on or around July 18th, adjusted EBITDA will be approximately £7.8 million - up from £6.3 million in a 25% increase - while adjusted EPS*** is set to significantly increase.
The Board is also confident that the transition from a traditional 'perpetual licence' business model to a 'subscription licence' model is well underway, which is evidence by a significant increase in the run-rate of recurring revenues. This has been driven primarily by the success of Ideagen Coruson, the company's SaaS based enterprise Risk and Safety Management solution which is allowing the Group to win larger contracts and grow high-visibility, subscription-based revenue.
Finally, cash generation was extremely strong at the end of the financial year and accordingly net cash was significantly ahead of market forecasts at £4.2 million. This was despite paying £4.6 million of consideration for the acquisitions of IPI Solutions and Gael Ltd (deferred) and £0.3 million in dividends. The Board expects to report that cash generated by operations will be in excess of 100% adjusted EBITDA**.
* FY2016 comparator prepared on a proforma basis as if these acquisitions had occurred during that year
**Earnings before interest, tax, depreciation, amortisation, share based payments, acquisition costs and other exceptional items.
***Adjusted diluted earnings per share