PCI-PAL ends first half as expected
By Josh White
Date: Tuesday 06 Feb 2024
(Sharecast News) - Business communications and cloud payment specialist PCI-PAL said in an update on Tuesday that revenue in its first half met management expectations, increasing 20% year-on-year to £8.7m.
The AIM-traded firm said annual recurring revenue at the end of the period was ahead 23% at £14.7m.
Notably, the period marked a significant milestone as it became the group's first reported half-year of positive EBITDA since re-launching as PCI-PAL in 2016.
During the period, the annual contract value (ACV) of new business sales amounted to £1.6m, surpassing the prior year by 9%.
A significant portion of the growth was attributed to the company's market-leading partner ecosystem, which the board said contributed a record-breaking 87% of the ACV signed during the half-year, compared to 83% in 2022.
Moreover, sales continued to thrive beyond the period, with the group delivering more than £2m in total new business ACV in the current financial year.
The board added that the sustained sales momentum was propelling the group towards its profitability objectives.
The company concluded the first half with net cash of £0.54m, compared to £1.17m on 30 June, primarily due to the payment of £1.1m in costs related to a patent case.
Its debt facility remained undrawn, ensuring financial stability and flexibility for future endeavours.
In a strategic move to further strengthen its partner ecosystem, PCI-PAL announced a major global partnership with Zoom on 13 November.
In terms of the ongoing patent litigation with competitor Sycurio, PCI-PAL reported significant progress, achieved a victory in the UK trial and invalidating Sycurio's patents for prior art and proving non-infringement.
Despite Sycurio's appeal of the verdicts, the US litigation was ongoing, with the trial now scheduled for February 2025.
The board said it believed Sycurio's lawsuit was an attempt to disrupt PCI-PAL's business, with the risk of any material impact on the company due to the litigation substantially decreasing following the UK trial victory.
"We continue to grow strongly and this performance is testament to our long term, partner-first strategy," said chief executive officer James Barham.
"The first half saw us sell more ACV proportionately through our partner ecosystem than ever before.
"We believe we are well positioned to capitalise on this base to drive expansion business through that ecosystem, particularly with the rollout of our newly enhanced product-set and the addition of Zoom as a significant new partner."
Barham said the start of the second half had seen the group maintain new sales momentum, as it continued to focus on delivering its profitability objectives, enhancing shareholder value, and capitalising on strategic opportunities for continued growth.
PCI-PAL said it would announce its interim results for the six months ended 31 December in the week of 26 February.
At 1158 GMT, shares in PCI-PAL were down 13.51% at 48p.
Reporting by Josh White for Sharecast.com.
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