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Sopheon talks up 2017 performance, says current year is on track
Business software provider Sopheon updated shareholders on its current operations on Thursday, as they gathered for its annual general meeting, saying that it was continuing to advance its strategy to be the "world's leading" provider of enterprise-class innovation management solutions.
The AIM-traded firm claimed its vision had "consistently led the market", in a market which continued to "evolve" and demonstrate "considerable growth".
It said it delivered a "very strong finish" to last year, resulting in all the group's headline financial measures exceeding market expectations by a sizeable margin.
Revenues rose to $28.5m from $23.2m in 2016.
On the back of an already-strong increase in profitability in 2016, the Sopheon board said EBITDA last year reached $8.0m, up from $5.6m the year before, and profit before tax was $5.1m, compared to $3.0m a year earlier.
Alongside a realignment of its debt position, that resulted in net assets rising to $18.6m from $10.4m the year before, and net cash rising to $9.5m from $4.2m.
"Both volume and average value of license transactions increased compared to the year before," the Sopheon board said.
"Towards the end of 2017 we signed substantial deals with two industry leading, blue chip, companies in the US and in Germany and we are now in the process of implementing our 'Accolade' solution globally in both cases."
Such customers further validated the momentum and acceptance of Accolade as an enterprise platform within the largest and most influential corporations in the world, Sopheon claimed.
"We saw more acceptance of our software-as-a-service (SaaS) offering, with three new SaaS customers signed last year, and our recurring revenue base improved to over $12m by the end of the year compared to just under $10m the year before."
Sopheon said its market differentiation continued to be validated, with it being the only vendor recognised in three different Gartner Market Guides - for Strategy Execution Management Software; Innovation Management Tools; and Strategy & Innovation Roadmapping Tools - as well as in its 'Magic Quadrant' for Project Portfolio Management Worldwide.
"In our view, the capabilities called for in all of these respective reports are required to deliver on the promise of connecting strategic planning and operational execution.
"In addition, Sopheon was named a Leader in the 2017 Forrester Wave: Strategic Portfolio Management Tools."
The board said further recent market validation was recognition by Consumer Goods Technology magazine, naming Sopheon as 'Best in Category' in new product development and introduction as voted by readers.
"Collectively, these are major strategic milestones in establishing the credentials of both the company and our market."
In order to deliver on its growth strategies as described in its annual report, the board said it was executing on "ambitious" investment plans across multiple functional areas to scale for growth for 2018 and beyond.
Where appropriate, it said it was also open to consideration of targeted merger and acquisition opportunities if consistent with its goals and focussed investment criteria.
"Alongside strategic initiatives, we remain highly driven by revenue and profit objectives, and to stand behind this ambition we have proposed a maiden dividend, to be put to the company's shareholders at today's meeting.
"Remaining on the corporate theme, we were delighted with the success of our oversubscribed secondary placing completed in mid-May, which expanded our institutional shareholder base and we are grateful for the support and demand shown by certain blue chip institutional investors for the company's shares."
Looking ahead, Sopheon said the positive momentum had continued in the current year, and it was signing additional new business which in turn was underpinning the performance for the year.
Full year revenue visibility for 2018 from contracted business and recurring revenue streams was now up 34% at $23.5m, compared to $17.5m at the same time last year - an all-time high for its mid-year AGM report.
"This includes the effect of several perpetual license deals and major services extensions, as well as a further major SaaS deal closed during the current quarter.
"The board continues to be confident and enthusiastic about the prospects of the company, the outturn for the year and the opportunity to continue to deliver on our vision."