At today’s Annual General Meeting of Sopheon plc, the international provider of software and services that help organizations generate more revenues and profits from new products, the Board will give shareholders an update and review of the business. This will include the following statement from the Chairman:
“My last annual statement to shareholders highlighted the ongoing transition in Sopheon’s business model, and its impact on our performance. It is very gratifying, one year later, to be able to report solid strategic progress and results for 2015 and into the early months of 2016. Revenues grew from just over $18m in 2014 to almost $21m last year. This double-digit growth was achieved in spite of headwind in the form of a strengthening dollar. The improvement in profitability was even more marked, with EBITDA more than tripling to $4.1m, and profit before tax at $1.2m.
Two years ago we embarked on a strategic growth transition to migrate from delivering process automation tools to delivering enterprise class innovation management solutions. We made substantial progress in 2014, but not without some disruption to business momentum, which continued into the first half of 2015. In spite of these short-term financial consequences, we remained confident in our path during the transition and continued to lead the market in vision, experience and capability that today in our opinion remain unmatched by competitors. Our dual market segmentation focus on both the complex global enterprise and the simpler, “out-of-the-box” Express model for quick time to value, is gaining traction. This view was validated by the naming of Sopheon in Gartner’s 2015 Market Guide for Enterprise PPM Software, and recent Enterprise Innovation Management research conducted by CIMdata.
Our 2015 performance was broad based. We signed 14 new customers and closed another 28 transactions with existing customers. New wins included expansion of our Asian presence with a major Chinese chemical business sold through our important partner relationship in that territory, and several Express offerings that are now fully deployed. In addition, we signed a number of major enterprise contracts, including a software-as-a-service (SaaS) deal with a Fortune 100 consumer products corporation with substantial recurring revenue potential. Our largest customer accounted for 11 percent of revenue, and no other customer was above 6 percent.
As in previous years, we have maintained the pace of new product releases consistent with our Agile methodology, releasing Accolade® 9.3 in February 2015, 10.0 in June, 10.1 in September, 10.2 in January and most recently Accolade 10.3 just a few weeks ago. We have been taking action to enable world-class adoption of our solutions for some time and we are now seeing the benefits in our performance metrics in both of the market segments mentioned above. All of our product releases include new and enhanced functionality driven by, or anticipating, customer needs and our sales and services organizations have been restructured to be customer value centric. We saw third-party validation of this effort in the recent Sopheon recognition as Customer Service Leader in the new product development and introduction solutions category as voted by the executive readership of Consumer Goods Technology (CGT) magazine; selection by the same readership for the sixth consecutive year as a best-in-class new product development solution; and the Gartner and CIMdata reports mentioned above.
The board remains confident that Sopheon is on the right path, with strong momentum and pipeline for further advancement in 2016. Full year revenue visibility for 2016 from contracted business and recurring revenue streams is now approaching $17m, compared to $12.5m at this time last year. We continue to expand resources in line with the growth areas of the business to support this strong momentum, and maintain our leading market position. Our success is in no small part due to the commitment and diligence of our people, and I take this opportunity to thank all in Sopheon who made it possible.”
For Further Information Contact:
|Barry Mence, Chairman
Arif Karimjee, CFO
|Sopheon plc||+ 44 (0) 1276 919 560|
|Ed Frisby / Carl Holmes / Giles Rolls (corporate finance)
Mia Gardener (corporate broking)
|finnCap||+ 44 (0) 20 7220 0500|
Sopheon (LSE: SPE) partners with customers to provide complete enterprise innovation management solutions including software, expertise, and best practices, that enable them to achieve exceptional long-term revenue growth and profitability. Sopheon’s Accolade solution provides unique, fully-integrated coverage for the entire innovation management and new product development lifecycle, including strategic innovation planning, roadmapping, idea and concept development, process and project management, portfolio management and resource planning. Sopheon’s solutions have been implemented by over 200 customers with over 60,000 users in over 50 countries. Sopheon is listed on AIM, operated by the London Stock Exchange.