DotDigital earnings rise as it looks to 'normalisation' of trading

Marketing automation and customer engagement software company DotDigital reported organic revenue growth of 23% in its final results on Tuesday, to £58.1m.

The AIM-traded firm said recurring revenue, as a percentage of total revenue, increased to 93% for the year ended 30 June, from 91% in the 2020 financial year, while monthly average revenue per customer (ARPC) grew 16% to £1,251.

Adjusted EBITDA grew 9% to £19.8m, and adjusted operating profit was 5% higher year-on-year to £13.7m.

The company said its adjusted earnings per share from continuing operations came in at 4.06p, up from 3.9p in the prior year.

Its board described the firm’s net cash balance at year-end as “strong” at £32m, up from £25.4m, as it proposed a final dividend of 0.86p per share, in line with its progressive dividend policy and up from 0.83p for 2020.

Looking ahead, DotDigital said the “normalisation” of its trading environment was continuing as markets transitioned out of lockdowns.

The board said it was assessing the potential varied effects of that move across its “broad and diversified” customer base, adding that it had a “high level of confidence” in the delivery of management expectations for the new financial year, following a strong start.

“We are pleased to report a record year for DotDigital, delivering double-digit organic growth and enhanced profitability as a result of an accelerated uptake of our omnichannel offering,” said chief executive officer Milan Patel.

“This performance is testament to our robust business model, as we navigated and supported our customers through the pandemic, and the efforts of our talented and dedicated team.

“The investments we have made in our engagement cloud platform, international hubs and partner network are bearing fruit.”

Patel said the company’s data-driven marketing automation platform was still ‘excelling’ in the market as a result of its “feature-rich yet user-friendly” functionality, with the company “well-positioned” to support a growing number of customers looking to drive deeper engagement with consumers through digital marketing.

“As we enter the new year, trading remains strong.

“Our healthy balance sheet, strong recurring revenues and cash generation provides the flexibility to invest in our growth strategy, giving the board confidence in the group's long-term prospects.”

At 1113 GMT, shares in DotDigital Group were down 8.68% at 228.31p.