System1 pleased with second quarter trading
By Josh White
Date: Tuesday 22 Oct 2024
(Sharecast News) - System1 Group reported strong second-quarter growth in a trading update on Tuesday, driven by a significant increase in platform revenue.
The AIM-traded firm said that for the half-year ended 30 September, total revenue rose 38% to £18.3m, with platform revenue surging 53% to £16.7m.
It said that growth was led primarily by the US market, where platform revenue more than doubled compared to the first six months of the 2024 financial year.
Data sales increased 48%, while data-led consultancy grew 76%.
In the second quarter specifically, platform revenue climbed 35% to £8.2m, making up 92% of total group revenue for the quarter.
Overall, total second-quarter revenue was £8.9m, up 25% year-on-year, despite lower non-platform revenues.
The company attributed the strong performance to a series of new client wins, including over 160 new platform clients, such as a global short-form video platform, a major automotive business, and an international food delivery company.
Gross profit for the first half reached £16m at a margin of 87.3%, with operating expenses rising 23% due to investments in personnel, product, and marketing to support future growth.
Statutory pre-tax profit was expected to be about £2.5m - a significant increase from £0.9m in the first half of 2024.
System1 said its cash balance stood at £8.9m as of 30 September, down from £9.6m in March, largely due to performance bonus payments and currency fluctuations.
"I am delighted that our focus on winning in America is delivering strong growth and financial results," said chief executive officer James Gregory.
"We are continuing to win and retain business with the world's largest advertisers and will be accelerating and significantly increasing investment in the coming months to build our position in America and revitalise System1's Innovation proposition."
The company said it would release its full interim results on 3 December.
At 1326 BST, shares in System1 Group were down 9.57% at 633p.
Reporting by Josh White for Sharecast.com.
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