Business
Financial Update: 12 months to 31 December 2019
Financial Update: 12 months to 31 December 2019.
About this update from Getech Group Plc
[{"type":"text","content":"\n \nRNS Number : 7884A GETECH Group plc 24 January 2020 \n\nGetech Group plc\n(\"Getech\" or the \"Company\" and with its subsidiaries the \"Getech Group\")\nFinancial update: 12 months to 31 December 2019\nGetech (AIM; GTC) today issues a financial update ahead of the announcement of its results for the year ended 31 December 2019. The audited results for 2019 are expected to be released in April 2020.\nOverview\nAgainst what remains a volatile macroeconomic and commercial backdrop for oil and gas exploration spending, Getech increased its new forward sales by 41%, expanded its orderbook by 48% and the Group's cash balance closed the year at c£3.6 million (31 December 2018: £1.4 million).\nBy strategically driving orderbook growth, with a focus on annually recurring revenue, we are working to increase visibility and progressively lessen Getech's exposure to lumpy transactions.\nHighlighting the importance of this, negotiations on several substantial transactions overran from December 2019. We remain in negotiation on these sales, the value of which had the potential to deliver material 2019 revenue growth. The fact that they did not complete in 2019 however is expected to result in a c£2 million year-on-year fall in revenue.\nGetech's results for the period ended 31 December 2019 will therefore be below market expectations. Lower total costs and continued investment in the drivers of multi-year sales will however limit the year-on-year impact on profitability, and across H2 2019 cash balances rose by £0.6 million.\n12 months to 31 December 2019 - expected revenue, sales, costs and EBITDA\nBased on early unaudited management accounts, revenue for the 12 months to 31 December 2019 is expected to total c£6 million (2018: £8.0 million). In addition, Getech closed another c£2.4 million of new forward sales (2018: £1.7 million) - a significant portion of which will unwind to revenue in 2020.\n· Getech's orderbook grew to c£3.1 million at 31 December 2019 (31 December 2018: £2.1 million)\n· The total cost base[1] is expected to lie between £6.3 million to £6.5 million, at least 17% below 2018 (£7.8 million)\n· We anticipate having at least maintained Getech's gross profit margin (2018: 47%) and we expect EBITDA to lie between £0.6 million and £0.8 million (2018: £1.1 million)\nExpected impair...