Full year trading update

essensys PLC

31 August 2023

 

31 August 2023

essensys plc

("essensys" or the "Group")

Full year trading update

Good progress with accelerated strategy to drive profitability and cash generation

Adjusted EBITDA loss and year-end cash expected to be in line with market expectations

High single-digit revenue growth

essensys plc (AIM:ESYS), the leading global provider of software and technology to the flexible workspace industry, announces a pre-close trading update for the financial year ended 31 July 2023 ("FY23").  All figures in this announcement relate to the FY23 period unless otherwise stated.

Revenues are expected to grow by c.9% to £25.3m, driven by momentum in the US market, which remains our primary growth market.  This is a resilient performance in the current macroeconomic climate. 

At the end of the financial year, we accelerated our plans to return to sustainable growth, profitability and cash generation and the Adjusted EBITDA¹ loss for FY23 and cash at the year-end are expected to be in line with market expectations.  The restructuring of our global operations - to align our cost base and investments to our revenue base and the near-term market opportunity - is largely complete, with a reduction in headcount from 184 at its peak to 122, and the exceptional and non-recurring costs of achieving this will be reported below Adjusted EBITDA in FY23. essensys is now a leaner organisation and has an appropriate operational structure to support our customers and deliver our long-term strategy.

Our focus on larger strategic clients continues to deliver operational efficiencies and an improvement in our customer mix, whilst also driving our product roadmap and sales pipeline.

essensys ended FY23 with a cash balance of £7.9m, in line with market expectations after adjusting for the timing of final payments of approximately £1m to achieve the group reorganisation.  The Group remains debt-free and on track to return to run rate  positive Adjusted EBITDA in FY24.  Net cash generation is expected in FY25, achieved within current cash resources.

Mark Furness, Chief Executive Officer of essensys, said:

"To accelerate our return to profitability and sustainable growth, we have taken action to manage our cost base.  The reorganisation is now complete and gives us a strong base from which to support our customers' expansion plans.  We remain on track to meet our target of run-rate positive Adjusted EBITDA in FY24. We continue to support larger, tier one customers as they look to expand their premium flexible workspace offering.

"essensys creates seamless in-building experiences for flexible operations by removing complexity and reducing costs through automation and simplification.  We remain confident of the long-term structural growth opportunity in the flexible office space - and well-placed to meet ongoing demand from larger flexible workspace operators for premium flexible workspace products."

For further information, please contact:

essensys plc		[phone]
Mark Furness, Chief Executive Officer
Sarah Harvey, Chief Financial Officer
Singer Capital Markets (Nominated Adviser and Broker)		[phone]
Peter Steel / Harry Gooden / James Fischer
FTI Consulting
Jamie Ricketts / Eve Kirmatzis / Talia Shirion / Victoria Caton		[phone]

Notes

1.     Adjusted EBITDA is earnings before interest, tax, depreciation, amortisation, exceptional restructuring costs and other non-trading items such as impairment, share option charges and exchange differences.

About essensys plc

essensys is the leading global provider of software and technology for flexible, digitally-enabled spaces, buildings and portfolios. The essensys Platform simplifies and automates the delivery and management of next generation, flexible, multi-tenant real estate.

The real estate industry is transforming - it must be flexible to changing market demands, accommodate hybrid working styles, provide move-in ready spaces and deliver frictionless experiences and on-demand services. The office sector is becoming an increasingly digital-first landscape - driven by end-user demand and delivering digitally enabled spaces is key to success. Our software and technology is designed and developed to help solve the complex operational challenges faced by landlords and flexible workspace operators as they grow and scale their operations. We help our customers to deliver a simple, secure and scalable proposition, respond to changing occupier demands in a hybrid world, provide seamless occupier experiences, and realise smart building and ESG ambitions.

Founded in 2006 and listed on the AIM market of the London Stock Exchange since 2019, essensys is active in the UK, Europe, North America and APAC.

 

END