LONDON (ShareCast) - (Sharecast News) - Software company Skillcast Group reported a year of robust growth in annualised recurring revenue (ARR) in an update on Wednesday.

The AIM-traded firm said its revenue for 2023 was expected to reach £11.3m, making for a 15% increase compared to the prior year's figure of £9.8m.

It said its growth had been entirely organic, and was primarily attributed to a substantial surge in recurring subscription revenues, which jumped 28% to reach £8.5m.

In 2023, recurring subscription revenues accounted for 76% of total group revenue, demonstrating a substantial increase from the 68% share observed in 2022.

However, professional services revenues for the year were reported at £2.8m, making for a 12% decrease from the prior year's £3.1m.

Skillcast said its ARR also showed remarkable growth, surging by 37% from £6.8m in December 2022 to £9.3m in December 2023.

That, the board said, was primarily fuelled by the acquisition of new customers and increased sales of new products.

With a robust pipeline of new business opportunities, the company added that it was well-positioned to continue achieving its revenue objectives in the coming year.

In terms of profitability, Skillcast reported that its EBITDA loss for 2023 was not expected to exceed £0.8m, widening from £0.3m a year earlier.

The group said its financial health remained strong, with a net cash position of £7.2m as of 31 December - only slightly lower than the £7.7m reported at the end of 2022.

That translated to about 8p per share in the company.

"We are delighted with our performance in 2023 - our SaaS subscriptions ARR growth rate accelerated from 16% in 2022 to 37% in 2023," said chief executive officer Vivek Dodd.

"This validates our two-year plan to accelerate our technology and sales investment since our initial public offering in December 2021.

"We now have the products and key personnel to sustain growth and return to profitability in the second half of 2024."

Skillcast said it expected to announce its full-year results and recommend a final dividend for the year ended 31 December in April.

At 1500 GMT, shares in Skillcast Group were up 12.91% at 29.92p.

Reporting by Josh White for Sharecast.com.

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