LONDON (ShareCast) - (Sharecast News) - Cloud payment technology provider PCI-PAL reported an "excellent" first half in a trading update on Wednesday, with all of its key metrics either at or ahead of management expectations.
The AIM-traded firm said that as a result, it anticipated revenue and losses before tax would now be better than current full-year market expectations.

In the first six months, revenue increased 72% year-on-year to £5.4m, which the company said reflected the strength of its channel-focused, subscription-based revenue model.

The group also recorded growth in its key indicator of future recurring revenues, total annual contract value, by 37% to £11.4m.

Its board said that increase was the new business annual contract value signed in the period of £1.8m, up from £1.7m year-on-year, with 81% of such contracts signed through reseller partners, compared to 74% a year ago.

Adding to that revenue growth was the company's performance against the key software-as-a-service (SaaS) metrics associated with its customer success function.

PCI-PAL reported that its positive net revenue retention for its AWS platform increased to 120% from 111% at the end of June, which included a number of expansion sales to several enterprise-sized customers.

Additionally, customer churn on the platform further improved to 3.4% from 6.7% over the same period.

The board said the strong trading performance enabled it to maintain cash balances of £5.5m, which was down from £7.5m as at 30 June.

Proceedings in relation to the alleged patent infringement being made against the company were ongoing, with PCI-PAL saying it was working towards an outcome that it believed would best benefit the business.

"Demand for our market leading cloud services continues to gather pace as a result of our well-established and growing partner ecosystem; our targeted, account-based direct sales activity; and the strong early results from our increased focus on customer success which is driving net recurring revenue and churn rates into the top quartile for B2B SaaS benchmarks," said chief executive officer James Barham.

"Furthermore, we have made solid progress towards our growth plans for the year.

"Despite the universal hiring challenges faced by all companies, we have successfully expanded our team with key strategic hires across two new geographies of Canada and Australia, as well as expanding our team in the US and across core business functions in the UK such as product development and engineering."

Barham said that at the same time, the company's employee retention rates remained "encouragingly very high".

"With the strength of trading shown to date, and a growing pipeline and partner ecosystem, we now anticipate that the group will exceed its current market revenue expectations, resulting in a reduced loss before tax for the financial year.

"The board remains confident in the longer-term outlook for the group, and continues to invest in its ambitious growth strategy."

At 1404 GMT, shares in PCI-PAL were up 12.07% at 65p.

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