Eckoh swings to profit as US operations shine
By Duncan Ferris
Date: Tuesday 19 Nov 2019
(Sharecast News) - Eckoh on Tuesday swung to an interim profit after strong revenue growth was driven by new business wins on the other side of the Atlantic.
The secure payment technology firm booked a profit before tax of £2.6m for the six months ended 30 September, compared with a loss of £0.2m in the same period last year, as revenue jumped by 37% to £18.0m.
The AIM traded company said this was due to a 104% surge in US turnover to £7.5m, following growth in all stateside channels and a £3.8m contract win from its Coral business.
Meanwhile, the larger UK division saw sales grow by 11% to £8.8m, driven higher by the deployment of new business and higher transactional volumes from the company's major clients.
Gross margins declined from 84% to 79% after the US business was impacted by the sale of the Coral licences, though Eckoh said it expected its product portfolio to be enhanced even faster and at higher margins following innovation initiatives.
Chief executive Nik Philpot said: "In the US we continue to benefit from our market leading position in secure payments, with revenues doubling, a record order book, and an increasing number of large enterprises successfully deployed. We expect attractive macro drivers to support future growth, as corporates face significant risks and costs if they do not comply with tougher regulations.
"Our strong first half, excellent revenue visibility and ongoing investment in our market-leading products, provides a robust platform for the full year outturn and reinforces our confidence in the positive long-term outlook for the group."
Eckoh shares were up by 2.04% at 49.49p at 1507 GMT.
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