27 July 2023

Eleco Plc

("Eleco", "Group" or the "Company")

H1 Trading Update

The Board of Eleco plc (AIM: ELCO), the AIM-listed specialist software provider for the built environment, is pleased to provide a trading update for the six months ended 30 June 2023 (the 'Period'), based on unaudited management accounts for the Period:

·    Annualised recurring revenues¹ (ARR) at 30 June 2023 increased 18% to circa £19.7m (£16.7m at 30 June 2022).

·    Total recurring revenues (TRR) for the Period increased by approximately 18% to £9.7m (H1 2022: £8.2m), representing 72% of total revenue (H1 2022: 61% of total revenue).

·    Total revenues for the Period are expected to be circa £13.5m (H1 2022: £13.4m).  Revenues in the first half of 2023 reflect the SaaS transition and also the impact of the end-of-life of the Group's Memmo and Sitecon products, the end-of-life of a third-party resold product in Sweden, and the absence of the revenue contribution from the German ARCON business disposed of in February 2023. 

·    Underlying cash generation in the business remained strong.  The cash position at the Period end of £9.4m (at 30 June 2022: £11.3m; at 31 December 2022: £12.5m) is reflective of the recently announced acquisition of BestOutcome Ltd.  The Period end balance is following the net cash consideration of £3.5m and an increased final dividend and special dividend payments totalling £0.9m in the Period (H1 2022: £0.3m). 

¹ ARR is defined as normalised annualised recurring revenues and includes revenues from subscription licenses, contract values of annual support and maintenance, and SaaS contracts. This ARR figure is calculated prior to the inclusion of the forthcoming contribution from the BestOutcome acquisition. 

The Interim Results will be reported in full in September with a date to be confirmed in due course. 

Jonathan Hunter, Chief Executive Officer of Eleco plc said:

"We are delighted with Eleco's trading performance for the first six months of the financial year, and we remain in line with market expectations for the financial year. 

"As we emerge from H1 2023, which we previously flagged would be the low point of the temporary financial impact of the SaaS transition, we are reporting revenues above those of H1 2022 and we look forward to an acceleration in total revenue growth for the remainder of the year and beyond.  

"We commence the second half of 2023 with the reintroduction of the recognised and respected Asta product brand to reflect our suite of broader project scheduling solutions.

"The recent addition of BestOutcome Ltd to the Eleco family, with its SaaS recurring revenues, strengthens the existing Building Lifecycle portfolio and further builds our offering to a more diverse customer base to solve the challenges of the Built Environment.  Integration work is already well underway.   

"Eleco continues to deliver on its SaaS strategic journey, focussing on increasing organic recurring revenues, supplemented by inorganic growth opportunities, to the benefit of its customers and shareholders.  The Board therefore remains confident in Eleco delivering market expectations for the full year."

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About Eleco plc

Eleco plc is an AIM-listed (AIM: ELCO) specialist international provider of software and related services to the built environment through its operating brands Elecosoft, BestOutcome and Veeuze from centres of excellence in the UK, Sweden, Germany, the Netherlands and the US.

The Company's software solutions are trusted by international customers and used throughout the building lifecycle from early planning and design stages to construction, interior fit out, asset management and facilities management to support project management, estimation, visualisation, Building Information Modelling (BIM) and property management.

For further information please visit www.eleco.com.