Year-end trading update
25 January 2022
("Eleco", "Group" or the "Company")
Year-end trading update
The Board of Eleco Plc (AIM: ELCO), the AIM-listed construction software specialist, is pleased to provide a trading update for the year to 31 December 2021, based on unaudited management accounts for the period.
Unaudited revenue for the period is expected to be £27.3m, an increase of 8% compared with the same period in 2020, and above market expectations. This has been underpinned by double-digit sales growth from its core Building Lifecycle portfolio. Recurring revenue overall increased by £1.2m (9%) to £15.4m, following the successful launch and acceleration of the Company's SaaS/Subscription strategy.
The Board expects EBITDA for the period to be ahead of expectations at £7m, (2020: £6.7m). Free cash flow is expected to be in line with prior year at £5.5m.
Cash generation has been strong, resulting in a significant increase in net cash which was £10m as of 31 December 2021, compared to £6.2m as of 31 December 2020. In the second half of 2021 the strong net cash position allowed the Company to repay the main bank debt outstanding of £2.8m. The Company now has no bank debt and £0.1m of other borrowings.
Jonathan Hunter, CEO, commented:
"2021 has been a transformative year which has seen Eleco make excellent progress with its refreshed strategy. Highlights include winning Project Management Software of the Year at the UK Construction Computing Awards, record sales growth for our ShireSystem product, which is now the Group's second largest product by revenue, and customer success stories including an Irish-based international building materials manufacturer expanding the use of ShireSystem software throughout six of its factories located in Europe.
"We continued to strengthen our growth platform with the successful merger of our UK building lifecycle businesses and the merger of our German visualisation operations, providing greater business development opportunities. In the last quarter of the year, we also delivered SaaS/Subscription offerings across all our Building Lifecycle products, with a particular focus on new customers. In addition to establishing the senior leadership team during 2021, we strengthened the Board with new and experienced Non-Executives.
"We are therefore delighted to report that we expect to exceed market expectations for 2021 and that our gross profits and EBITDA levels continue to be strong. Our debt-free status leaves Eleco well positioned for 2022 and we believe that our strong growth in 2021 endorses our decision to focus the business on its core competencies while targeting growth in recurring revenue."
 Market consensus for 2021 revenues was £26.9m, EBITDA of £6.7m and free cash flow at £3.6m
The information contained within this announcement is deemed to constitute inside information as stipulated under the retained EU law version of the Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. The information is disclosed in accordance with the Company's obligations under Article 17 of the UK MAR. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
+44 (0)20 7422 8000
Serena Lang, Non Executive Chairman
Jonathan Hunter, Chief Executive Officer
Robert Tearle, Chief Financial Officer
+44 (0)20 7220 0500
Geoff Nash/Kate Bannatyne (Corporate Finance)
Richard Chambers/Charlotte Sutcliffe (ECM)
SEC Newgate UK
+44 (0)20 3757 6882
Elisabeth Cowell/Bob Huxford/ Isabelle Smurfit
About Eleco plc
Eleco plc is an AIM-listed (AIM: ELCO) specialist international provider of software and related services to the Architectural, Engineering, Construction and Owner/Operator (AECO) industries and interior furnishing industries from centres of excellence in the UK, Sweden, Germany, Netherlands and the US.
The Company's market-leading Elecosoft software solutions are developed by teams in the United Kingdom, Sweden and Germany, and its solutions cover project management, estimating, timber engineering, CAD and visualisation, asset and facility management and cloud-based digital marketing solutions.
For further information please visit www.eleco.com.