16 January 2024
Eagle Eye Solutions Group plc
("Eagle Eye", the "Group", or the "Company")
H1 Trading Update
and
Notice of Results
Delivering results in line with expectations and continued expansion in the US
Eagle Eye (LSE: "EYE"), a leading SaaS technology company that creates digital connections enabling personalised, real-time marketing, provides an update on the Group's trading for the six months ended 31 December 2023 (the "Period").
Highlights
| | H1 FY24 | H1 FY23 | % change |
| Group Revenue | £24.1m | £20.0m | +20% |
| Recurring revenue (subscription fees and transactions) | 78% | 78% | - |
| Adjusted EBITDA* | £5.9m | £4.7m | +25% |
| Adjusted EBITDA* margin | 24.3% | 23.5% | +0.8ppt |
| Net cash at 31 December** | £7.8m | £5.7m | +36% |
| · | Continued positive trading has delivered revenue and EBITDA growth in line with Eagle Eye's "Rule of 40" objective and Board expectations |
| · | The Group continues to win and expand its relationship with some of the world's largest retailers. Eagle Eye now has eight North American customers and a growing presence in Europe and Asia, alongside its long-standing UK customers |
| · | Successful first year for Untie Nots as part of the Group, including expansion with key customers and major new wins, including entry into the UK market through a win with Morrisons, benefitting from Eagle Eye's larger marketing reach and relationships |
| · | Investment in innovation to capitalise on the expanding market opportunity, including the creation of a new AI offering, EagleAI, launched at the world's largest retail trade show, NRF, in New York, last week |
| · | Awarded 7th place in the UK's Best Companies to Work for, and named the 7th most innovative marketing technology company in the world in the TMW 100 awards |
| · | The Board is confident in delivering another year of profitable growth in line with its expectations |
The Group delivered another good performance during the Period, achieving revenue and profit growth in line with its "Rule of 40" objective (revenue growth + Adjusted EBITDA margin = 40+). Revenue grew 20%, to £24.1m (H1 FY23: £20.0m) and adjusted EBITDA* increased 25% to £5.9m (H1 FY23: £4.7m), representing an EBITDA margin of 24.3% (H1 FY23: 23.5%).
In line with Board expectations, reflecting seasonal flows and payment of an element of the outstanding consideration in respect to the Untie Nots acquisition, the Group had a net cash outflow of £1.5m in the Period (H1 FY23: £2.0m inflow), resulting in a net cash position of £7.8m at 31 December 2023 (30 June 2023: £9.3m). The Board expects the Company to be cash generative in the second half of the financial year.
Eagle Eye continued to expand across its target geographies in the Period, securing a high level of new 'Wins', with highlights including two five-year loyalty contracts in North America, bringing Eagle Eye's total North American customer numbers to eight, including the first win for EagleAI. Other wins include a three-year contract with an Australian retailer, and a three-year contract with The Ivy Collection in the UK, a popular group of brasseries and cafes, to power its colleague discount scheme.
The Group's continued strong performance has been supported by the deepening of existing relationships, delivering a continued strong level of Net Revenue Retention. Highlights include expansion with Woolworths in Australia, Hudson's Bay in North America, as well as Asda in the UK.
The Company's newly acquired business, Untie Nots, continues to perform strongly, expanding with existing customers, including E.Leclerc, as well as entering new territories through the strength of the Eagle Eye sales and marketing efforts, including deepening Eagle Eye's relationship with Morrisons, adding Untie Nots' AI-powered 'Challenges' product.
In the period, Eagle Eye signed a partnership agreement with commercetools, a global leader in composable commerce headquartered in Germany, with the intent to launch an integration-led Partnership in early 2024. This will enable commercetools customers to access the power of the Eagle Eye AIR platform and its associated Loyalty and Promotional capabilities on their eCommerce websites through a single, ready-to-use connection.
The Group's innovative AI-offering, EagleAI, was successfully launched last week at the world's largest retail trade show, NRF in New York and we were delighted to announce our first customer for EagleAI last week.
During the Period, the Group moved up the rankings to 7th place in the UK's Best Companies to Work for and was named the 7th most innovative marketing technology company in the world in the recent TMW 100 awards, where it also received the prestigious Judges Pick accolade. These are recognition of the Group's continued embodiment of the "Golden Rule": treating people as they'd like to be treated, which is the guiding principle behind the Group's world-class culture.
Outlook
Retailers around the world are continuing to assess how best to provide highly relevant, personalised promotions and loyalty offerings to their customers, including leveraging the benefits of data science and AI. The proven ability of Eagle Eye's AIR platform to deliver personalised promotions, in real-time, at the scale and speed required by the world's largest retailers, continues to drive a growing sales pipeline.
Supported by a scalable SaaS business model, high levels of recurring revenues, strong margins and increasing levels of cash generation, the Board remains confident in delivering results for FY24 in line with management expectations.
Tim Mason, Chief Executive of Eagle Eye, said:
"Through the AIR platform's ability to deliver hyper personalised messages to consumers at speed and scale, we are in a strong position to be an enabler of the advancements taking place in the world of retail marketing. With a growing addressable market, a newly launched AI-powered offering, EagleAI, an outstanding team and high-quality business model driving growth in revenue, profits, and cash generation, we are extremely excited about the future of Eagle Eye."
Notice of Results
The Group expects to announce its results for the six months ended 31 December 2023 on Tuesday, 19 March 2024.
Notice of Investor event
Eagle Eye will be hosting an in-person presentation for investors and equity research analysts on Thursday, 22 February 2024 in London, providing insight into the Group's growth strategy. Should you wish to attend, please contact eagleeye@almastrategic.com. No material new information will be provided on the day.
Notes:
All financials are based on unaudited figures
*EBITDA has been adjusted for the exclusion of share-based payment charges along with depreciation, amortisation, interest and tax from the measure of profit. H1 2023 EBITDA figure has also been adjusted to exclude costs associated with the acquisition of Untie Nots.
** Net cash is defined as cash and cash equivalents less financial liabilities and excludes placing proceeds raised associated with the consideration for the acquisition of Untie Nots, which was paid out following completion of the acquisition on 3 January 2023.
| For further information, please contact:
Eagle Eye Solutions Group plc Tim Mason, Chief Executive Officer Lucy Sharman-Munday, Chief Financial Officer
|
Tel: 0844 824 3686 |
| Investec (Nominated Advisor and Joint Broker) Corporate Finance: David Anderson / Nick Prowting
| Tel: 020 7597 5970
|
| Shore Capital (Joint Broker) Corporate Finance: Daniel Bush / David Coaten / Lucy Bowden Corporate Broking: Henry Willcocks | Tel: 020 7408 4090 |
|
Alma Strategic Communications Caroline Forde / Hannah Campbell / Kinvara Verdon |
Tel: 020 3405 0205 |
|
| |
About Eagle Eye
Eagle Eye is a leading SaaS technology company enabling retail, travel and hospitality brands to earn the loyalty of their end customers by powering their real-time, omnichannel and personalised consumer marketing activities.
Eagle Eye AIR is a cloud-based platform, which provides the most flexible and scalable loyalty and promotions capability in the world. More than 750 million personalised offers are executed via the platform every week, and it currently hosts over 200 million individual loyalty members for businesses all over the world. We are trusted to deliver a secure service at hundreds of thousands of physical POS destinations worldwide, enabling the real-time issuance and redemption of promotional coupons, loyalty offers, gift cards, subscription benefits and more.
The Eagle Eye AIR platform is currently powering loyalty and customer engagement solutions for enterprise businesses all over the world, including Asda, Tesco, Morrisons, Waitrose and John Lewis & Partners, JD Sports, Pret a Manger, Loblaws, Southeastern Grocers, Giant Eagle and the Woolworths Group.
In January 2023, the Group acquired France-based Untie Nots, an AI-powered personalised promotions business, adding Carrefour, E. Leclerc, Auchan and other leading brands to its European customer base.
Web - www.eagleeye.com
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