Final Results-INTERCEDE GROUP PLC

Final Results-INTERCEDE GROUP PLC

INTERCEDE GROUP plc

('Intercede', the 'Company' or the 'Group')

Preliminary Results for the year ended 31 March 2023

Intercede, a cybersecurity software company specialising in digital identities, today announces its preliminary results for the year ended 31 March 2023 ("FY23").

Headlines:

·    Record Group revenues at £12.1 million

·    Strong net profit of £1.3 million

·    Net cash generation from operating activities of £2.9 million

·    Basic EPS of 2.3p

·    Completion of maiden acquisition, Authlogics Ltd ("Authlogics") in October 2022

·    Integration of Authlogics on track

·    Continued investment in product and code including internal IT infrastructure

·    Clear strategic vision on M&A plans

·    Strong and unleveraged financial position

Financial Highlights

FY23

FY22

% Change

 

£ million

£ million

 

 

 

 

 

 

Revenue

12.1

9.9

22.2%

Gross profit

11.7

9.7

20.6%

Profit before Tax

0.6

0.3

100.0%

 

Net Profit

1.3

0.7

85.7%

EPS - basic

2.3p

1.3p

76.9%

EPS - diluted

2.2p

1.2p

83.3%

Gross Margin

97%

98%

-1.0%

Net Margin

11%

7%

57.1%

 

Cash and cash equivalents

8.3

7.8

6.4%

Net cash from operating activities

2.9

0.1

2800.0%

Deferred revenue

7.5

5.2

44.2%

Total Assets

17.4

12.9

34.9%

Total Equity

7.0

5.5

27.3%

Adjusted EBITDA

1.3

1.0

30%

Less:

Amortisation of intangibles

0.1

-

Depreciation of assets

0.1

0.1

Right-of-use depreciation

0.2

0.2

Acquisition costs

0.2

0.2

Employee Share/Unit incentive & option plan charges

-

0.1

Exceptional costs

0.1

-

Operating Profit

0.6

0.4

50.0%

Revenue highlights for the year include:

·    Revenues for the year ended 31 March 2023 totalling £12.1 million were approximately 22% higher than last year (2022: £9.9 million) and a 13% increase on a constant currency basis

·  Multiple MyID PIV licence orders from the US Department of State (DoS) for the MyID Identity Management System (IDMS) solution totalling $1.6 million. The same agency also placed services orders with a value totalling $0.3 million. Linked to this sale is a third party embedded product which marginally impacted gross profit in the year

·    Licence orders continued in the latter half of the year, with sales to a telecommunications provider in the US, an energy company in the EU, new deployments for the UK government, and further new sales in UAE, Saudi Arabia and Oman

·    Several significant customers have chosen to upgrade their existing MyID deployments including, but not limited to, a UK Government department, a US central bank and a key US government agency. A major US defence and consultancy contractor is upgrading to MyID v12.6

·   A $0.2 million follow-on order of professional services for a prestigious independent US Federal Agency that was won at the end of the last financial year. The deployment will leverage Intercede's technology partnership with Microsoft, by delivering PKI credentials into Microsoft Intune managed smartphones enabling sensitive data protection and secure access to agency systems

·   A follow-on MyID Enterprise order from a US Federal agency tasked with intelligence and security services. Orders have been received to date for 75,000 device licences.

Operating Highlights

·    Acquisition of Authlogics Ltd, a UK based company, with annual recurring revenues (ARR) of £0.5 million. It brings Multi Factor Authentication (MFA) and Password Security Management (PSM) capabilities to the Intercede Group. Integration plans are on track and a merged development road map enacted for FY24

·  Increased investment in key departments of the Group including development & testing and product management

·   The M&A programme continues, focused on targets that add recurring revenues and have a strong industry and product logic

·    A strategic review of the Group's IT infrastructure was conducted in the year, and we has now commenced a deployment into the Microsoft cloud with the aim of increasing resilience, stability and scalability

·    Continued upgrades of MyID with v12.6 and v4.2 for Authlogics MFA released at end of March 2023

·    The Group successfully maintained ISO 9001 and 27001 certification which now includes US operations.

Outlook

This has been an encouraging and successful year for the Group. However, to maintain and sustain its current momentum, it needs to continue to invest in its colleagues, IT Infrastructure, product development and sales and marketing.

We embark in to FY24 with good visibility on the pipeline, known and fully resourced internal critical investments and with a clear road map on our acquisition strategy. As mentioned frequently, the focus is on 'growth' and execution of strategic plans to deliver it.

Board Changes

During the year Andrew Walker retired from the Board with the appointment of Nitil Patel as his successor and new Chief Financial Officer of Intercede. Royston Hoggarth, Non-Executive Director of the Company succeeded Charles 'Chuck' Pol as the Group's Chairman. Tina Whitley was appointed as an Independent Non-Executive Director, bringing over 30 years' experience across the information technology sector.

As also announced today, Chuck Pol and Rob Chandhok will step down from the Board as Non-Executive Directors in due course. The Board is delighted to welcome John Linwood as a new Non-Executive Director. John brings with him considerable market knowledge and a breadth and depth of skills and experience. Our thanks and best wishes go to Chuck and Rob for their service to the Company.

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