TIDMDOTD
RNS Number : 8262Z
dotDigital Group plc
27 January 2022
27 January 2022
Dotdigital Group plc
("Dotdigital", the "Group" or the "Company")
Trading Update and Notice of Half Year Results
Continued organic growth underpinned by recurring SaaS business
model
Dotdigital Group plc (AIM: DOTD), the leading 'SaaS' provider of
an omnichannel marketing automation and customer engagement
platform, announces a trading update for the six months ended 31
December 2021 ("H1 2022"). The trading performance reported in this
statement is based on unaudited management accounts.
The Board is pleased to report that it expects to report a first
half performance in line with market expectations for the full
year.
Highlights
-- Group revenue increased c.10% to GBP30.9m (H1 2021: GBP28.2m)
driven by growth in sales from both new and existing
customers
o Against a strong prior year comparator, revenue from
SMS sends is now at more normalised levels, post immediate
pandemic related activity
-- R&D continues to underpin Dotdigital's growth strategy,
with recurring revenues from enhanced product functionality
growing by 22% to GBP10.8m (H1 2021: GBP8.9m)
-- ARPC(1) up by 19% to GBP1422 per month (H1 2021: GBP1196
per month), driven by a continued increase in new and
existing client spend
-- Revenue, adjusted EBITDA(2) and adjusted profit before
tax expected to be in line with market expectations(3)
-- Cash balance at 31 December 2021 of GBP40.0m (30 June
2021: GBP32.0m)
Overview
The Group's organic growth strategy, namely ongoing product
innovation, geographic expansion and growth through strategic
partnerships, delivered solid growth in the first half of the year
against a strong comparative period.
The Group secured new sales with both new and existing
customers. New wins include Warner Bros, Sunderland Football Club
and the British Dental Association.
Underpinning both the Group's consistent double digit revenue
growth and over 20% operating margin, is the Group's predictable
SaaS business model.
Product innovation
The Group's growth is supported by a focussed R&D investment
programme which continues to drive value for both our new and
existing customers. Recurring revenue from enhanced product
functionality and upgrades increased 22% to GBP10.8m. The key areas
of investment for the Group remain: enhancing our customer data and
experience platform capabilities; data visualisations through
reporting and analytics; deeper integrations with new and existing
technology partners; and our user experience of the platform.
Geographic expansion
Organic international revenue increased by 4% to GBP9.7m (H1
2021: GBP9.3m) in the period, with international sales contributing
31% to total revenue (H1 2021: 33%).
EMEA showed solid revenue growth of c.10% in the period to
GBP23.6m (H1 2021: GBP21.5m). The Group continues to see growing
demand in the region for its omnichannel capability, as marketeers
increase their focus on relevancy and personalisation to provide
the best possible customer experience.
Revenues from the Americas grew organically by c.3% to $6.5m (H1
2021: $6.3m). In a challenging labour market with high levels of
wage inflation, the Directors continue to focus on strengthening
the management team in the region, most recently with the addition
of a new VP of Growth. The recruitment of talent and expanding the
employee base is key to improving growth rates within the
region.
APAC revenue grew organically by c.27% to AUS$4.4m (H1 2021:
AUS$3.5m). The Group's Japan office is now operational and uptake
of the Engagement Cloud in Singapore has been encouraging. The
Group has continued to develop its presence in Australia despite
the challenges posed by lockdowns.
The Group continues to navigate various cost pressures,
particularly regarding hiring, across all regions but is confident
of actions being taken by management to support the Group's
geographic expansion strategy in the second half and beyond.
Strategic partnerships
Sales through connectors into our strategic partners increased
by 9% to GBP13.9m (H1 2021: GBP12.8m).
Magento connector revenue grew 6%, Shopify connector revenue
grew by 47% and MS Dynamics connector revenue grew by 3% compared
to the same period in the previous year.
Whilst the Group works through pressures in the US, it continues
to build on its work with its strategic partners, both in the
ecommerce and CRM platform space, to drive brand awareness across
their customer bases through joint go to market plans. In H1, the
Group increased its investment in adding new channel managers into
its international operations, building on the strong relationships
it has with its agency and technology partners that operate within
the ecosystem.
The pipeline continues to build with strong momentum as the
Group moves into H2.
Notice of H1 2022 Half Year results
Dotdigital Group plc will announce its Half Year results for the
period ended 31 December 2021 on 3 March 2022.
Milan Patel, CEO of Dotdigital, commented: "The Group delivered
another half year period of double-digit growth, with continued
sales momentum across channels from new and existing customers.
These results demonstrate a growing interest in our core offering
and continued execution of the growth strategy in a structurally
growing market.
Our Engagement Cloud platform is one of the most technically
advanced yet user-friendly offerings in the market, and the
investment we continue to make in our omnichannel capabilities
stands us in good stead to capture the full spectrum of
opportunities presented by the ongoing shift to digital
marketing.
The Group's continued growth is supported by a strong balance
sheet, a recurring SaaS business model and healthy sales pipeline,
putting us in a strong position as we enter the second half of the
year. Whilst cognisant of the fluid global economic environment,
the Board is confident in the continued positive performance of the
business."
(1) ARPC means average revenue per customer.
(2) EBITDA means earnings before interest, tax, depreciation,
amortisation, and before restructuring, other non-recurring costs
and certain non-cash items.
(3) Consensus revenue for continuing operations as at 24 January
2022, for the year ending 30 June 2022, is approx. GBP65.6 million.
Consensus adjusted EBITDA for continuing operations as at 24
January 2022, for the year ending 30 June 2022, is approx. GBP20.9
million. Consensus adjusted profit before tax as at 24 January
2022, for the year ending 30 June 2022, is approx. GBP14.5
million.
For further information please contact:
Dotdigital Group Plc Tel: 020 3953 3072
Milan Patel, CEO InvestorRelations@dotdigital.com
Paraag Amin, CFO
Alma PR (Financial PR) Tel: 020 3405 0210
Hilary Buchanan dotdigital@almapr.co.uk
David Ison
Josh Royston
Canaccord Genuity (Nominated Adviser Tel: 020 7523 8000
and Joint Broker)
Bobbie Hilliam
Georgina McCooke
Jonathan Barr, Sales
finnCap (Joint Broker) Tel: 020 7220 0500
Stuart Andrews, Corporate Finance
Alice Lane, ECM
Rhys Williams, Sales
Singer Capital Markets (Joint Broker) Tel: 020 7496 3000
Shaun Dobson, Head of Corporate
Finance
Alex Bond, Corporate Finance
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inside information for the purposes of Article 7 of Regulation (EU)
596/2014 (MAR) (Market Abuse Regulation).
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END
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