Pre-close trading update

RNS Number : 3128S

Eagle Eye Solutions Group PLC

07 July 2015

 

 07 July 2015

Eagle Eye Solutions Group PLC

("Eagle Eye" or the "Company")

Pre-Close Trading Update

Continued strong strategic progress

Eagle Eye, a leading UK provider of digital consumer engagement solutions to the retail and hospitality industries, is pleased to announce the following trading update ahead of its audited preliminary results for the year ended 30 June 2015 (the "Period") which are anticipated to be announced on 16 September 2015.

Period Highlights:

·    Group revenue increased c.165% to £4.9m (FY14: £1.8m)*, of which organic growth represented c.90%

·    Over 40 new customer and brand wins including major contracts with Sainsbury's, as announced separately today and Asda for the deployment of Eagle Eye AIR in both grocers' UK stores

·    Significant two year contract renewal with Ladbrokes for SMS services

·    Successful placing of 3,007,626 shares in the company, that raised approximately  £4m (before expenses) and sold 994,512 shares for an existing shareholder

·    Redemption volumes increased in excess of 75%

·    Transactional revenues represented c.80% of total revenues (FY14: 67%)

·    Like for like messaging volumes up in excess of 25%

·    New partnership signed with SAS

·    Cash position expected to be £4.3m

*Based on unaudited figures

Trading

Based on unaudited figures, turnover for the Period is expected to be in the region of £4.9m, up c.165% on the prior year (FY2014: £1.8m). Organic growth is expected to be c.90%. The percentage of revenue from transactions is expected to be approximately 80% (FY2014: 67%) and we expect to report cash of £4.3m.

Underlying market trends and the strength of the customer sales pipeline remain strong and continue to reflect the transformational appeal of Eagle Eye's platform. However turnover for the year ended 30 June 2015 is anticipated to be lower than management expectations, this is primarily as a result of a delay in certain contract implementations and the phasing of new business wins. Our proven technology delivers key benefits to our clients including an enhanced consumer experience, significant operational cost savings and accelerated innovation. Given the sales pipeline and contract wins already announced, the Board's turnover expectations for FY2016 remain unchanged.

Existing clients continue to derive benefits from Eagle Eye's platform, which is demonstrated by the growth in redemption volumes crossing our network, up c.75% in the Period to over 14.0 million. Messaging volumes at the now fully integrated 2ergo business increased to over 40.0 million (FY2014: 31.6 million), further evidencing the success of the acquisition and its integration.

The net proceeds of the placing, completed in March 2015, are being used to accelerate investment in product development and infrastructure and to increase sales and marketing resources in order to capitalise on the market opportunity and drive international expansion.

Customers

Eagle Eye has continued to make strong strategic progress since the start of the Period, bringing over 40 new customers and brands on to the Eagle Eye AIR platform. These notably include two major contracts with tier 1 UK grocers, Asda and Sainsbury's (as announced separately today), which together account for over 30% of the UK grocery market. The signing of two of the UK's top four retailers is a major endorsement of the benefits that the Eagle Eye AIR platform delivers to our customers. Other notable live launches during the Period included The Restaurant Group, Young's and VF International SAGL (that owns brands such as Wrangler, Vans and North Face). These wins add further strength to our share of the UK hospitality sector and a step into the European market with the VF group.

In line with Eagle Eye's stated strategic objectives, the grocery contracts also provide the Group with significant opportunities to engage directly with FMCG brands, where the bulk of promotional expenditure is incurred, allowing them to create bespoke digital offers that enhance the consumer experience and gather invaluable insight. During the Period, Eagle Eye powered a successful Coke Zero campaign through the network with Greggs and One Stop, delivering on the Company's aforementioned strategic solution.

In addition to the new wins above, the Company has been successful in renewing its significant contract with Ladbrokes Plc for SMS services for a further two years, which underpins the future of the messaging business.

Technology

The Eagle Eye AIR platform continues to evolve into a full Software as a Service platform. Over the last twelve months, significant resources were invested in the platform, adding new features and functions to support tier 1 grocers and FMCG brands, whilst scaling to meet the ever increasing demands on the platform. Investment in the platform has accelerated since the successful fundraise in March 2015.

The Company has signed a new partnership with SAS, a leading business intelligence and data analytics company, to connect SAS tools into the Eagle Eye platform and help customers gain a deeper insight of consumer behaviour. This partnership is anticipated to support further sales into the tier 1 grocers. In addition, the Company has entered into reseller agreements with a number of electronic point of sale (EPOS) suppliers, which help grow the customer sales pipeline.

Phill Blundell, Chief Executive, said:

"Since last year, we have made significant commercial, operational and strategic progress, including bringing two tier 1 grocers on to Eagle Eye's platform. Our progress is strong recognition of the power of the Eagle Eye AIR platform and the benefits it brings to retailers and hospitality brands. The digital coupon market is growing rapidly and we believe Eagle Eye is best placed to facilitate this transition as the market continues to shift from paper to digital. We are continuing to make progress against our strategic objectives and, underpinned by continued strong and increasing demand for our solutions, look forward with confidence. The Board's turnover expectations for FY2016 remain unchanged."

For further information, please contact: Eagle Eye
Phill Blundell, Chief Executive Officer Lucy Sharman-Munday, Chief Financial Officer	Tel: [phone]

Panmure Gordon
Hugh Morgan/Fabien Holler/Duncan Monteith, Corporate Finance Charles Leigh-Pemberton, Corporate Broking	Tel: [phone]
Hudson Sandler
Nick Lyon/Alex Brennan	Tel: [phone]
Information on Eagle Eye www.eagleeye.com

About Eagle Eye

Eagle Eye is a leading UK provider of digital consumer engagement solutions to the retail and hospitality industries, enabling our customers to deliver real-time digital promotions to their consumers.

The Company's digital transaction platform, Eagle Eye AIR, enables the secure, real-time, multi-channel issuance, management and redemption of digital offers, vouchers and rewards, replacing previously used paper-based methods. The coupons, stored value and loyalty-based rewards markets are currently transitioning through substantial change as both retailers and consumers are moving away from paper and plastic to digital offers, vouchers and rewards. These markets, in aggregate, are estimated to be worth £54.8 billion, £4.7 billion and £210 million respectively.

The Eagle Eye AIR platform comprises four key components: campaign creation; issuance; redemption and reporting. The Company's products supported by the Eagle Eye AIR platform allow the Company's customers to deliver relevant offers, vouchers and rewards to consumers in real time, in a simple and secure way, across multiple marketing communications channels including email, SMS messaging and loyalty apps. The promotions can be redeemed securely by the consumer through any enabled point of sale channel. Eagle Eye PROMOTE, a module within the AIR platform, enables FMCG suppliers to login, set up and monitor their own campaigns in real-time.

The Company's current customer base comprises leading names in UK retail and hospitality including Asda, Sainsbury's, The Restaurant Group, Greggs, JD Sports, Ladbrokes, Marks & Spencer, Mitchells & Butlers, Pizza Express, Tesco, Thomas Pink and Young's.

The Group is headquartered in Guildford and has an office in Manchester.

 

END

 

 

TSTLLFFDDLIRIIE