Full Year Results

About this update from Essensys Plc

6 January 2026 essensys plc ("essensys", the "Company" or the "Group")   Full year results   essensys plc (AIM:ESYS), the leading global provider of software and technology to the flexible workspace industry, announces its audited results for the twelve months ended 31 July 2025 ("FY25"). All information relates to this period, unless otherwise specified.    Financial summary:   £m unless otherwise stated FY25 FY24 Change       Revenue 19.2 24.1 -21% Recurring revenue 1 16.9 20.2 -17% Run Rate Annual Recurring Revenue (ARR) 1 15.0 20.3 -26%       Revenue at constant currency 2 19.6 24.1 -19% Recurring revenue at constant currency 17.5 20.2 -13% Run rate ARR at constant currency 15.6 20.3 -23%         Adjusted EBITDA 3  1.3 (0.9) 244%         Statutory loss before tax (5.7) (5.5) -4%         Loss per share (pence) (8.6)p (5.1)p           Net Cash 1.8 3.1     1 See CFO review below for description and breakdown 2 Current period revenue and/or costs translated into GBP using the average exchange rate for the comparative prior period 3 Adjusted EBITDA is earnings before tax, depreciation, amortisation, exceptional items and other non-trading items, such as share option charges   Operational highlights - significant progress and strategic execution   ·      Launch of new product, elumo, with initial sales across all core markets ·      Completion of data centre decommissioning project realising £1.5m in annualised cost savings ·      Board appointments bring significant strength and experience to essensys ·      Strategy centred on three pillars: Land, Expand, Grow   o  Land: Adoption through essensys Platform and elumo o  Expand: Product innovation combined with site growth across core geographies o  Grow: Deepening customer relationships and positioning as a strategic partner ·      Post year end restructure around core products expected to generate cost savings and scalable operations   o  Dedicated, agile elumo team to drive new customer acquisition and accelerate adoption o  Focused essensys Platform team to deepen customer relationships, improve service, and proactively manage retention   Financial highlights - return to EBITDA profitability and improved margin quality   ·      Return to positive Adjusted EBITDA of £1.3m (FY24: £0.9m loss) ·      Revenue at £19.2m (FY24: £24.1m), reflecting previously anticipated downsizing of a single large strategic customer ·      ARR at £15.0m (FY24: £20.3m). Excluding the single large customer above and at constant currency, ARR from strategic customers decreased by 2%, driven by portfolio rationalisation and the previously expected shift away from Cloud and into essensys Platform ·      Gross margin improved to 59% (FY24: 57%) due to a higher proportion of recurring revenue and a more focused operating model ·      Cash at year-end: £1.8m (FY24: £3.1m) ·      essensys remains debt free; discussions ongoing to secure a debt facility to optimise capital structure and support strategic growth   Current Trading and Outlook   ·      Q1 FY26 revenue broadly in line with management expectations ·      FY26 performance anticipated to be materially below management expectations due to the volatile macroeconomic environment leading to elongated sales cycles and slower than anticipated adoption rates for elumo ·      Management remains focused on: o  Maintaining strong customer engagement, o  Operational resilience, efficiency and cash management, and o  A targeted go-to-market approach and enhanced product suite.   Possible Offer   ·      As announced on 28 November 2025, Mark Furness, founder and a Non-Executive Director, has submitted a preliminary, indicative, non-binding proposal to the independent directors of the Company relating to a possible all-cash offer for the entire issued and to be issued share capital of the Company at 20 pence per share       James Lowery, Chief Executive Officer of essensys, said: " FY25 marked a year of significant operational progress for essensys, underpinned by the successful launch of elumo, the execution of substantial cost-saving initiatives and the restructuring of the business as announced in November to support our two core products with a sharpened focus on strategic customers. This progress aided essensys in its return to EBITDA profitability, despite ongoing macroeconomic challenges, delivering £1.3m in Adjusted EBITDA for the year.   "While revenue reduced year on year, due to the downsizing of a customer, it also reflects a deliberate evolution of our customer portfolio and revenue mix, with a greater emphasis on scalable, higher-quality software revenues. This shift drove an improvement in gross margins and strengthens the long-term sustainability of the business. We continue to see strong structural tailwinds in flexible workspace, supported by a clear flight to quality.   "While we expect volatile macro-economic trading conditions to continue in the short term, we remain confident in our strategy, product suite and long-term growth opportunities, and that we are well positioned to benefit as market conditions improve."   For further information, please contact:      essensys plc   +44 (0)20 3102 5252     James Lowery, Chief Executive Officer  Greg Price, Chief Financial Officer   Canaccord Genuity Limited (Nominated Adviser and Broker)   +44 (0)20 7523 8000  Simon Bridges / Harry Gooden / Andrew Potts / Elizabeth Halley-Stott Gracechurch Group   Heather Armstrong / Alexis Gore / Rebecca Scott +44 (0)20 4582 3500    About essensys plc     essensys is the leading provider of software and technology to landlords and flexible workspace operators. Founded in 2006 and listed on the AIM market since 2019, essensys' mission is to power the world's largest community of flexible, technology-driven spaces. Under new leadership, the Company has simplified its go-to-market strategy around two core offerings: essensys Platform and elumo.     essensys Platform is a SaaS platform that delivers enterprise-grade Wi-Fi seamlessly across portfolios of multi-tenant workspaces, while providing data insights to optimise performance. The Group's latest offering, elumo, provides customers with a new way to manage and monetise bookable spaces. The integrated bookings and access solution transforms meeting rooms and shared spaces from operational headaches into revenue-generating assets.   With customers in the UK, Europe, North America and APAC, essensys is deploying a newly launched and simplified go-to-market strategy, positioning the business long-term growth in the flexible workspace and commercial real estate market.   Chairman's statement   FY25 has been a year of transition for essensys, marked by meaningful progress towards long-term, sustainable growth in the flexible and hybrid workspace sector. A key priority was returning the Group to profitability, achieved with Adjusted EBITDA of £1.3m (FY24: £0.9m loss). This represents an important milestone, demonstrating the effectiveness of our actions to better align costs with earnings, and focus on high-quality recurring revenues.   Group revenue was £19.2m, reflecting the deliberate move away from lower non-recurring hardware and network sales and the down-sizing of a single customer. While this has reduced reported revenues in the short term, we believe our renewed focus on strategic customers will enhance the quality and resilience of our customer base, strengthening the business for future growth.   Operational discipline has been another focus. The completion of the data centre decommissioning project in July 2025 delivered £1.5m of annualised cost savings, streamlining our infrastructure and strengthening financial performance. These actions, alongside tighter cost control, have simplified operations and improved our ability to scale. In addition, we have restructured the essensys team to better support our product and services offering post year end, and these changes are also expected to generate significant annualised cost savings.   Innovation continues to sit at the heart of our strategy, with over 25% of our team dedicated to R&D. This year we launched elumo, our new dynamic meeting room bookings and access platform, enabling our customers to quickly monetise their assets. Though slower than anticipated, the product has gained early traction across key markets, securing its first sales to customers post year end, including a multi-site portfolio in the US. While the macro trading environment remains volatile, this positive response reinforces our confidence in elumo as a significant future growth driver.   FY25 also saw important changes to the Board to support our next phase of development. Greg Price joined as CFO in October 2024, bringing over two decades of senior finance experience. In May 2025, James Lowery succeeded founder Mark Furness as CEO, having previously served as COO. James brings a strong background in scaling flexible workspace propositions and real estate strategy. The Board also welcomed Sian Herbert as an Independent Non-Executive Director and Audit Committee Chair in July 2025, adding significant expertise in audit, risk, and governance. Mark Furness remains on the Board as a Non-Independent Non-Executive Director and continues as our largest shareholder.   In summary, FY25 has been an important year towards reshaping essensys for long-term success. With simplified operations, a sharper customer focus, and the launch of new products, we have returned to profitability, enhanced our SaaS-centric model, and built a stronger foundation for scalable long-term growth. The Group remains debt free and to strengthen the Group's financial resilience, we are exploring debt facility options with potential banking partners. While the current macroeconomic environment continues to influence customer decision-making, our new structure will enable increased focus on our long-term priorities, which remain expanding recurring revenues, improving margins, and generating cash.   On behalf of the Board, I would like to thank our team for their resilience and shareholders for their continued support.   Jon Lee Non-Executive Chairman 5 January 2026     Chief Executive Officer's Report   FY25 has been a year of significant operational progress for essensys, during which the Group has achieved a number of important milestones supporting its evolution. Focus has centred on the launch of elumo, the successful execution of cost-saving initiatives, sustained customer engagement, and most recently, the restructuring of the business to better support its two core products, elumo and essensys Platform.   Financial Performance   Despite ongoing macroeconomic challenges, the Group achieved its stated goal of returning to Adjusted EBITDA profitability, reporting £1.3m for the year. This underscores the effectiveness of cost management initiatives, simplification of operations, and a sharpened focus on strategic customers.   While revenue was broadly in line with market expectations, it was lower than FY24 at £19.2m, reflecting the anticipated downsizing of a single large strategic customer. Importantly, these results represent an evolution in the Group's revenue mix: although earnings are lower in the short term, they are of higher quality, with a greater proportion driven by software revenues. This shift contributed to an improvement in gross margins to 59% (FY24: 57%).   Cash at year end was £1.8m (FY24: £3.1m). To further strengthen the Group's financial resilience and support its long-term growth ambitions, essensys is in active discussions to secure a debt facility. This process is designed to optimise the Group's capital structure and ensure its ability to pursue key growth opportunities. The Group remains debt free.   The Evolving Market Landscape   The real estate sector has faced significant volatility in recent years, but the past 12 months have seen a notable shift in activity. Data shows that 48% of UK businesses expect a full return to in-person working within the next year, a trend mirrored internationally 1 and at the same time, the flexible workspace sector is forecast to grow at a CAGR of 18% between 2025 and 2032 2 . Coupled with the ongoing "flight to quality" in office space, these dynamics create strong tailwinds for the Group across its core markets in the UK, US and Australia.   While forecasts in the real estate sector continue to signal underlying strength, macroeconomic instability across global markets is creating a more cautious operating environment for essensys' customers. Inflation, interest rate uncertainty, and wider geopolitical factors are affecting confidence and investment planning, particularly in sectors sensitive to capital allocation and long-term commitments. Against this backdrop, the Group has seen some portfolio rationalisation as customers focus on their more profitable sites, reflecting the bifurcation in the market. The Group is mindful of the potential for extended sales cycles and a temporary moderation in sales activity as customers adopt a more cautious approach to capital expenditure, particularly for elumo.   1 British Chamber of Commerce: Office Return Varies Across Sectors. August 2025 2 Fortune Business Insights, Flexible Office Market Size, Share & COVID-19 Impact, 2025   Customers and Go to Market   Strategic customers continue to be a key priority for essensys, supported by new product launches and a more flexible way of deploying connectivity.   As reported in the Group's Trading Update in November 2025, one of its customers will not be renewing its essensys Platform contract, which represents total annual recurring revenues of £0.9m. The current contract concluded at the end of December 2025 and is already factored into management forecasts and overall customer churn remains broadly in line with management expectations.   essensys' growth strategy remains focused around three key pillars: Land, Expand and Grow. New customer adoption is driven by two scalable entry points, essensys Platform and the newly launched elumo, both of which provide operators with digitally-enabled, flexible workspace solutions that help to improve customer experience and support revenue generation. Expansion will come from combining product innovation with site growth across core geographies, while long-term growth will be achieved by deepening customer relationships and positioning essensys as a strategic partner offering a suite of products that underpin operational success.   elumo is an important driver of scalability within the Group's business model. Since launch, it has secured initial sales across all of the Group's key markets, the UK, US and Australia, most notably a portfolio deal with an existing US customer spanning 20 sites. While macroeconomic conditions have resulted in elongated sales cycles and slower-than-anticipated adoption, the Group continues to expect strong medium-term demand.   To strengthen new customer acquisition, reduce customer churn and recognise the different maturity levels of the Group's two core products, management has restructured the business around their specific needs. A dedicated, agile team has been formed to prioritise new business generation and accelerate the adoption of elumo. In parallel, a focused essensys Platform team is responsible for enhancing customer relationships, improving service delivery, and proactively managing retention.   Product Development   By maintaining its focus on product development, the Group continues its mission to help operational landlords and flexible workspace providers manage the complexity of operating large multi-tenant portfolios. In the second half of FY25, elumo was launched, providing a unique solution to transform how bookable spaces are managed and monetised. It enables customers to unlock and maximise revenue from under-utilised rooms while improving the user experience and providing real-time utilisation and booking intelligence.   Benefits for operators: ·      Shared spaces are transformed into revenue-generating assets. ·      Instant, rule-based access ensures that only authorised users can enter their digital environment. ·      Real-time intelligence on utilisation and bookings enables every square foot of space to be optimised. ·      Charges are seamlessly passed into the customer's invoicing platform of choice for onward billing to tenants. elumo's intelligent IoT gateway also enables the collection of real-time sensor data, providing the potential for the platform to evolve further, unlocking additional opportunities to enhance how users interact with customer spaces.   As previously stated, the Group has adapted the deployment of its network services (essensys Cloud), providing customers with the ability to deploy essensys Platform over existing connectivity and existing enterprise grade hardware. This reduces barriers to adoption for essensys Platform customers and aligns with market demand for pure-play SaaS solutions that address the operational needs of multi-tenant real estate.   Taken together, the progress achieved over the past year reflects a stronger revenue mix, a streamlined operating model with a reduced cost base, and an ongoing focus on strategic customers, leaving the Group well positioned for sustainable growth in the medium and long term.   Cost savings A key milestone in the year was the completion of the data centre decommissioning project, closing 10 data centres globally and delivering annualised cost savings of £1.5m. This marks an important step in the transition to a SaaS-first model and supports the Group in cash flow generation and improved margins.   The post year end restructure around the Group's core products is expected to generate additional annualised cost savings, further protect cash flow, and support scalable operations.   Current Trading and Outlook   Revenue for the first quarter of FY26 amounted to £4.1m, which was broadly in line with management expectations, and primarily driven by essensys Platform. While customer interest in the Group's new product, elumo, remains strong, the current macroeconomic environment has led to elongated sales cycles and slower than anticipated adoption rates, which is expected to impact FY26 sales. The Company does however continue to expect good adoption over the medium term. essensys continues to see a clear "flight to quality" in the flexible workspace market, as occupiers favour premium, well-specified spaces. This reinforces the Group's strategic focus and positions the Company well for evolving market preferences.   As noted above, recognising the distinct characteristics and different maturity levels of the Group's two core products, management has restructured the business around the specific needs of each. A focused agile team has been established to drive the sales and adoption of elumo, whilst a dedicated essensys Platform team will deliver an improved customer experience.   As a result of the above, management anticipates FY26 results to be materially below their expectations. However, the Group remains committed to its strategic objectives, supported by a focused go-to-market strategy and an enhanced product suite aligned with customer needs.   essensys continues to monitor the volatile macroeconomic dynamics closely and is focused on maintaining strong customer engagement, ensuring operational resilience, and positioning the business to benefit as market confidence and investment appetite improve. The Group is confident in its ability to capitalise on the long-term structural tailwinds in the real estate market, where demand for high quality flexible, technology-enabled solutions continues to grow as companies return to office working.   Possible Offer   As announced on 28 November 2025, the Independent Directors of the Company, (being the full Board except for Mark Furness) confirm that Mark Furness, founder and a Non-Executive Director, has submitted a preliminary, indicative, non-binding proposal to the Independent Directors relating to a possible all-cash offer for the entire issued and to be issued share capital of the Company at 20 pence per share (the "Possible Offer"). Any Possible Offer would be made by a to-be-incorporated company.   The Independent Directors are in preliminary discussions with Mark Furness in relation to the Possible Offer. These discussions are at an early stage, and there can be no certainty that an offer will be made. A further update will be provided in due course.   James Lowery Chief Executive Officer 5 January 2026       Chief Financial Officer's Report   The financial results included in this announcement cover the Group's consolidated activities for the twelve months ended 31 July 2025. The comparatives for the previous twelve months were for the Group's consolidated activities for the twelve months ended 31 July 2024.   Financial Key Performance Indicators   £'m unless otherwise stated Twelve months to July 2025 Twelve months to July 2024 Change     Group Total Revenue  19.2 24.1 -21% North America  10.5 14.2 -26% UK & Europe 7.2 8.5 -16% APAC 1.5 1.4 6%     Recurring Revenue 1 16.9 20.2 -17% North America 9.4 12.3 -24% UK & Europe 6.4 6.6 -3% APAC 1.1 1.3 -15% Recurring Revenue %age of Total 88% 84%           Run Rate Annual Recurring Revenue 1 15.0 20.3 -26%       Recurring Revenue at constant currency 17.5 20.2 -13% North America 9.8 12.3 -20% UK & Europe 6.5 6.6 -2% APAC 1.2 1.3 -8% Run rate ARR 15.6 20.3 -23%       Non-recurring revenue 2.3 3.9 -41%       Gross Profit 11.3 13.7 -18% Gross Profit percentage 59% 57%   Recurring Revenue margin %age 63% 62%       Operating Expenses (10.0) (14.6) 32%           Adjusted EBITDA 2 1.3 (0.9) 244%         Statutory loss before tax (5.7) (5.5) -4%       Cash 1.8 3.1     1. Recurring revenue comprises income invoiced for services that are repeatable and are consumed and delivered on a monthly basis over the term of a customer contract. Run Rate Annual Recurring Revenue (Run Rate ARR) is an annualisation of the recurring revenue for the month identified (July 2025); this is used by management as an indication of the annual value of the recurring revenue for that month and to monitor long term revenue growth of the business. 2. Adjusted EBITDA is the earnings on operating activities before depreciation and amortisation, share based payment charges, credit loss provisions and restructuring expenses.     Revenue   Group total revenue decreased by 21% to £19.2m in FY25 (FY24: £24.1m), primarily due to the downsizing of a single large strategic customer, as previously guided. Excluding this customer, Group total revenue decreased by 11% and recurring revenue decreased by 5%, reflecting the anticipated impact of customer churn from smaller non-strategic customers and from our Cloud business. At constant currency, stripping out the negative impact of movements in the US Dollar, recurring revenue declined by 1%.   Run Rate ARR decreased by 26% year on year, again driven by the downsizing of the customer above. Excluding this customer and at constant currency, Run Rate ARR decreased by 5%. This again reflects the anticipated impact of customer churn from smaller non-strategic customers and from our Cloud business.   ARR from strategic customers decreased by 2%. This was driven by some property portfolio rationalisation as customers focus on their more profitable sites, as well as the continuing shift in product mix away from our lower margin Cloud product and into essensys Platform software products. essensys Platform now accounts for 72% of ARR (FY24: 67%). ARR from strategic customers continues to account for 79% (FY24: 82%). Excluding the single large customer above, the proportion of ARR from strategic customers increased by 2 percentage points to 72% (FY24: 70%).   From a regional perspective, North America remains our largest revenue contributor. While North America declined by 31% in terms of site numbers, this mainly related to the single customer above downsizing. Excluding this customer and at constant currency, Run Rate ARR for North America decreased by 1% and still accounts for 51% of total ARR (FY24: 49%). While UK and Europe ARR declined by 15%, this was driven by losses of non-strategic customers and reduced demand for our Operate solution. We have seen net site growth in this region with closing site numbers up 7 on FY24 year end. APAC growth continued with 15 new sites live in the year, an increase of 58%.   Non-recurring revenue comprises set up and installation costs and is recognised when a site is live. Non-recurring revenue reduced by 41% compared to FY24, reflecting challenging market conditions, with customers continuing to show hesitancy in capital investment. With initiatives to simplify installation completed in the year, as well as the launch of elumo, we expect a reduced requirement for customers to need upfront investment, reducing barriers to adoption and supporting future recurring revenue growth.   Gross profit   Gross profit decreased by 18% in the year, reflecting the reductions seen in revenue. Gross margins improved to 59% (FY24: 57%), driven by the changes seen in product mix, with an increasing amount of higher margin software from essensys Platform relative to declines in its Cloud product. As a result, recurring revenue margins increased by 1 percentage point to 63%. The emphasis on recurring revenue has also driven an increase in margins, with a lower proportion of non-recurring revenue.   Margins also benefitted from the Company's strategy to transition to a pure play SaaS model, which no longer requires essensys Cloud to deliver and which allowed essensys to successfully complete its FY25 data centre decommissioning project, closing 10 centres in the year as planned, with a further final two planned for closure in FY26. The annualised cost savings realised by the completion of this project total £1.5m, positioning the business to deliver stronger cash generation, higher margins and greater scalability, whilst better aligning with customer requirements.   Operating expenses   Operating expenses represent all administrative expenses, excluding restructuring costs and non-cash items of depreciation, amortisation, impairment and share option charges.   Operating expenses decreased by £4.6m (32%) compared to the prior year. This reflects the continuing emphasis on cost management and operational simplification in the business, as we control costs in the face of the challenging economic environment and builds on the savings achieved in FY24 through the Group reorganisation.   Adjusted EBITDA   Adjusted results are prepared to provide a more comparable indication of the Group's core business performance by removing the impact of certain items including exceptional items (material and non-recurring), and other, non-trading, items that are reported separately. Adjusted results exclude adjusting items as set out in the statement of consolidated loss and below, with further details given in Notes 7 and 8 of the financial statements. In addition, the Group also measures and presents performance in relation to various other non-IFRS measures, such as recurring revenue, run-rate annual recurring revenue and revenue growth.    Adjusted results are not intended to replace statutory results. These have been presented to provide users with additional information and analysis of the Group's performance, consistent with how the Board monitors results.   Adjusted EBITDA (being EBITDA prior to exceptional restructuring costs and non-cash impairment and share based payment) is calculated as follows:   £'m 2025 2024   Operating loss (5.6) (5.4) Add back:   Depreciation & amortisation 4.3 4.7 Impairment of goodwill 0.9 - Exceptional restructuring costs 1.4 0.2 Share based payment expense 0.3 (0.4) Adjusted EBITDA 1.3 (0.9)     Despite the challenging sales environment and lower revenues in the year, the Group achieved a return to profitability, as seen in Adjusted EBITDA of £1.3m. This was an improvement of £2.2m vs. FY24, reflecting the Group's continued focus on profitability and cash, which more than offset the reduction in revenue and gross profit.   The Group continues to invest in product development in the UK. Where such work is expected to result in future revenue, costs incurred that meet the definition of software development in accordance with IAS38, Intangible Assets, are capitalised in the statement of financial position. During the year, the Group capitalised £2.0m in respect of software development (FY24: £2.1m). This level of investment is reflected in the progress made in developing our products, with elumo launched in H2 FY25, and allows us to introduce innovation in our products, which is expected to drive the next phase of our growth.   Taxation   The Group recognised a £0.3m tax credit in the year in respect of R&D activities for the current financial year. This follows tax credits of £2.2m recognised in FY24 for R&D activities from FY21 to FY24.    Excluding this, the Group incurred a tax charge in the year of £0.1m (FY24: £0.1m), which represents taxes paid on foreign income in the year. There remains over £8.5m in Group carried forward taxable losses and therefore there is no expectation of tax payments in the short term.   Cash   Cash at the year end was £1.8m (FY24: £3.1m). Cash at the half year was £2.2m, with cash outflows in H2 reduced to £0.4m. This was supported by tax credits in respect of R&D activities received in H2 of £0.3m, with an underlying cash outflow of £0.7m, compared to £0.9m in H1.   Following the year end, the Group has undertaken a restructure of the business around the specific needs of its two core products, essensys Platform and elumo, recognising the distinct characteristics and different maturity levels of each. This will generate further cost savings and in addition to the cost savings already realised from the completion of the data centre decommissioning project, protects the Group's cash position going forward.     To further strengthen the Group's financial resilience and support its strategic growth objectives, essensys is in active discussions to secure a debt facility. This process is designed to optimise the Group's capital structure and ensure that essensys has the capacity to pursue key growth opportunities. Excluding leases, the Group is currently debt free.   In light of the continued impacts of global macroeconomic uncertainty, the Board has considered a number of different scenarios regarding trading and financial performance into FY26 and beyond and is confident that, in the event of a significant long-term downturn, the Group will have sufficient cash resources for the foreseeable future.   Greg Price Chief Financial Officer 5 January 2026   essensys plc   Consolidated Statement of Comprehensive Loss for the year ended 31 July 2025       Notes 2025 2024     £000 £000           Turnover 2 19,182 24,131 Cost of sales (7,947) (10,393) _________ _________   Gross profit 11,235 13,738   Administrative expenses 3 (16,545) (19,566) Share based payment expense (325) 448   _________ _________     Operating loss 4 (5,635) (5,380)     Interest receivable and similar income - 21 Interest payable and similar charges (82) (133) _________ _________   Loss before taxation (5,717) (5,492) Taxation 5 148 2,183 _________ _________       Loss for the year from continuing operations   (5,569) (3,309) _________ _________   Other comprehensive loss       Items that may be reclassified to profit or loss:     Currency translation differences (18) (59)   _________ _________   Other comprehensive loss for the year   (18) (59)   _________ _________ Total comprehensive loss for the year   (5,587) (3,368) _________ _________ Basic and Diluted loss per share 6 (8.6p) (5.1p) _________ _________     essensys plc   Consolidated Statement of Financial Position as at 31 July 2025       Notes 2025 2024     £000 £000         ASSETS     Non-current assets   Intangible assets 7 7,949 9,426 Property, plant and equipment 622 847 Right of use assets 572 1,319 _________ _________       9,143 11,592 Current assets   Inventories 732 888 Trade and other receivables 4,524 7,143 Cash at bank and in hand 1,781 3,101 _________ _________     7,037 11,132     _________ _________         TOTAL ASSETS   16,180 22,724 _________ _________ EQUITY AND LIABILITIES   EQUITY   Shareholders' equity   Called up share capital 162 162 Share premium 51,660 51,660 Merger reserve 28 28 Retained earnings (40,348) (35,086) _________ _________ TOTAL EQUITY   11,502 16,764 LIABILITIES   Non-current liabilities   Lease liabilities - 432 _________ _________ - 432 Current liabilities   Trade and other payables 3,120 3,844 Contract liabilities 761 648 Lease liabilities 673 1,008 Current taxes 124 28 _________ _________ 4,678 5,528 _________ _________   TOTAL LIABILITIES 4,678 5,960 _________ _________   TOTAL EQUITY AND LIABILITIES 16,180 22,724 _________ _________           essensys plc   Consolidated Statement of Changes in Equity for the Year Ended 31 July 2025       Share Share Merger Retained Total   capital premium Reserve earnings equity   £000 £000 £000 £000 £000 1 August 2024 162 51,660 28 (35,086) 16,764     Comprehensive loss for the year   Loss for the year - - - (5,569) (5,569) Currency translation differences - - - (18) (18) _______ _______ _______ _______ _______   Total comprehensive loss for the year - - - (5,587) (5,587) _______ _______ _______ _______ _______   Transactions with shareholders     Share based payment charge - - - 325 325 _______ _______ _______ _______ _______   31 July 2025 162 51,660 28 (40,348) 11,502 _______ _______ _______ _______ _______     Consolidated Statement of Changes in Equity For the Year Ended 31 July 2024       Share Share Merger Retained Total   capital premium Reserve earnings equity   £000 £000 £000 £000 £000   1 August 2023 161 51,660 28 (31,270) 20,580     Comprehensive loss for the year   Loss for the year - - - (3,309) (3,309) Currency translation differences - - - (59) (59) _______ _______ _______ _______ _______     Total comprehensive loss for the year - - - (3,368) (3,368) _______ _______ _______ _______ _______   Transactions with shareholders       Share based payment charge - - - (448) (448) _______ _______ _______ _______ _______             31 July 2024 162 51,660 28 (35,086) 16,764 _______ _______ _______ _______ _______     essensys plc   Consolidated Statement of Cash Flows for the Year Ended 31 July 2025       Notes 2025 2024     £000 £000         Cash generated from / (used by) operations 9 A 1,019 (2,010)     Corporation tax received 1,231 860 Foreign exchange differences - 82 _________ _________   Net cash generated from / (used by) operating activities 2,250 (1,068)   _________ _________     Cash flows from investing activities   Purchases of intangible assets 7 (2,105) (2,077) Purchases of property plant and equipment (448) (34) Interest received - 21 _________ _________   Net cash used in investing activities (2,553) (2,090)   _________ _________   Cash flows from financing activities   Repayment of lease principal (917) (1,408) Interest paid on lease liabilities (82) (133) _________ _________   Net cash used in financing activities (999) (1,541) _________ _________   Net decrease in cash and cash equivalents (1,302) (4,699) Cash and cash equivalents at beginning of year 3,101 7,862 Effects of foreign exchange rate changes on cash and cash equivalents (18) (62) _________ _________   Cash and cash equivalents at end of year 1,781 3,101   _________ _________ Cash and cash equivalents comprise:   Cash at bank and in hand 1,781 3,101   _________ _________   1 Basis of Preparation   The consolidated statement of comprehensive loss, the consolidated statement of financial position, the consolidated statement of changes in equity, the consolidated statement of cash flows and the associated notes for the year ended 31 July 2025 have been extracted from the Group's financial statements upon which the auditor's opinion is unqualified and does not include any statement under section 498 of the Companies Act 2006.   There were no new standards or amendments or interpretations to existing standards that became effective during the year that were material to the Group.   No new standards, amendments or interpretations to existing standards having an impact on the financial statements that have been published and that are mandatory for the Group's accounting periods beginning on or before 1 August 2025, or later periods, have been adopted early.   Whilst the financial information included in this announcement has been computed in accordance with international accounting standards, this announcement does not itself contain sufficient information to comply with all IFRS disclosure requirements. The Company's 2025 Annual Report and Accounts will be prepared in compliance with UK-adopted International Accounting Standards (IFRS).   This announcement does not constitute a dissemination of the annual financial report and does not therefore need to meet the dissemination requirements for annual financial reports. A separate dissemination announcement in accordance with the Disclosure Guidance and Transparency Rules (DTR) 6.3 will be made when the annual report and audited financial statements are available on the Company's website.   Statutory Information The financial information included in this announcement does not constitute statutory accounts and is consistent with the accounting policies of the Group, which were set out on pages 56 to 63 of the 2024 Annual Report and Accounts.   The statutory accounts for the year ended 31 July 2025 will be finalised on the basis of the financial information presented by the directors in this announcement and will be delivered to the Registrar of Companies following the Group's Annual General Meeting. The announcement of the results was approved on behalf of the Board of directors on 6 January 2026.      2 Segmental Reporting       The Group generates revenue largely in the UK and the US. The majority of the Group's customers provide flexible office facilities together with ancillary services (e.g. meeting rooms and virtual services) including technology connectivity.   The Group generates revenue from the following activities:   ·          Establishing services at customer sites (e.g. providing and managing installations, equipment and training on software); ·          Recurring monthly fees for using the Group's software platforms and technology; ·          Revenue from usage of on demand services such as internet and telephone usage and other, on demand, variable services; and ·          Other ad-hoc service.   The Group has one single business segment which is the provision of software and technology platforms that manage the critical infrastructure and business processes, primarily to the flexible workspace segment of the real estate industry. The Group has two revenue streams and three geographical segments, as detailed in the tables below.     2A Revenue analysis by geographic area             The Group operates in two main geographic areas, the United Kingdom and North America. The whole of the turnover is attributed to the principal activity. The Group's revenue per geographical segment is as follows:             2025 2024     £000 £000 Analysis of turnover by country of destination:   North America 10,474 14,158 United Kingdom and Europe 7,170 8,519 Asia Pacific region 1,538 1,454   Total Income 19,182 24,131     2B Revenue analysis by revenue streams         The Group has two main revenue streams, essensys Platform and Operate. The Group's revenue per revenue stream is as follows:      2025 2024 £000 £000     essensys Platform 18,005 22,671 Operate 1,177 1,460 Total Income 19,182 24,131   essensys Platform revenue includes all revenue generated in relation to the essensys Platform product. It includes revenue recognised at a point in time as well as recognised over a period of time.   Operate revenue includes all revenue generated in relation to the Group's Operate product. The revenue is recognised over a period of time.   2C Revenue disaggregated by 'point in time' and 'over time'               The Group revenue disaggregated between revenue recognised 'at a point in time' and 'over time' is as follows:         2025 2024 £000 £000     Revenue recognised at a point in time 2,297 3,874 Revenue recognised over time 16,885 20,257 Total Income 19,182 24,131             2D Revenue from customers greater than 10% of total revenue               Revenue from customers greater than 10% in each reporting period is as follows:         2025 2024 £000 £000     Customer 1 2,857 5,917     2E Contract assets and liabilities         Contract asset movements were as follows: 2025 2024 £000 £000     At 1 August 854 468 Transfers in the period from contract assets to trade receivables (256) (176) Excess of revenue recognised over cash (or rights to cash) being recognised during the period 159 242 Capital asset contract contributions capitalised - (21) Capital asset contract contributions released as contract obligations are fulfilled - - Capitalised commission cost released as contract obligations fulfilled (349) (356) Commission costs capitalised on contracts 275 697 At 31 July 683 854   Contract liability movements were as follows:         2025 2024 £000 £000     At 1 August 648 420 Amounts included in contract liabilities that were recognised as revenue during the period (648) (420) Cash received and receivables in advance of performance and not recognised as revenue during the period 761 648 At 31 July 761 648   Contract assets are included within 'trade and other receivables' and contract liabilities is shown separately on the face of the statement of financial position. Contract assets arise from the Group's revenue contracts, where work is performed in advance of invoicing customers, and contract liabilities arise where revenue is received in advance of work performed. Cumulatively, payments received from customers at each balance sheet date do not necessarily equal the amount of revenue recognised on the contracts. Capital asset contract contributions represent costs incurred by the Group in the form of customer incentives spread over the life of the customer contract. Commission costs capitalised on contracts represents internal sales commission costs incurred on signing of customer contracts and, in line with the requirements of IFRS15, spread over the life of the customer contract.   3 Restructuring costs               Restructuring costs were as follows:         2025 2024 £000 £000     Restructuring costs 1,360 207   Included within administrative expenditure are costs associated with a restructuring programme undertaken by the Group during the year. These costs represent an adjusting item to derive the Group's Adjusted EBITDA for the year ended 31 July 2025, an alternative performance measure not defined in UK-adopted International Accounting Standards.   During the year, the Group incurred restructuring costs, as it completed its data centre decommissioning project, closing 10 data centres in the year as planned, with a final further two planned for closure in FY26. In completing this project, the Group incurred one-off costs of c.£0.6m. This includes early termination costs and short term lease extensions of £0.3m, with the balance being the apportionment of cost for the time incurred by the team in delivering the project.   In addition, the Group also undertook headcount restructuring during the year, as it looked to reduce cost in the face of the challenging economic environment. As such, these costs reflect the impact of redundancies from this restructuring, which are non-recurring in nature.     4 Operating loss         2024 2024     £000 £000 This is arrived at after charging/(crediting):     Amortisation of intangible assets 2,716 2,710 Depreciation of tangible fixed assets 569 765 Depreciation of right of use assets 1,046 1,247 Impairment of goodwill 866 - Fees payable to the Group's auditor (see below) 159 150 Exchange differences 32 (5) Research & Development expense 1,977 1,988 Staff costs 10,265 13,517 Share based payments 325 (448) Analysis of fees paid to the Group's auditor:     Annual financial statements - group and parent company 158 150   Audit Fee 158 150   Assurance services - - Other services 1 -   Non audit services 1 -   Total fee 159 150     5 Taxation on loss on ordinary activities     2025 2024     £000 £000   Current tax   UK corporation tax (282) (300) Adjustment in respect of previous periods 27 (1,937) Foreign tax on income for the year 107 54 Total current tax (148) (2,183)   Deferred tax   Origination and reversal of timing differences - - Adjustments in respect of prior periods - - Total deferred tax - -   Taxation on loss on ordinary activities (148) (2,183)   The tax assessed for the year is higher than the standard rate of corporation tax in the UK applied to profit before tax. The differences are explained below:       2025 2024     £000 £000   Loss on ordinary activities before tax (5,717) (5,492)   Tax using the Group's domestic tax rates (25% (2024:25%)) (1,429) (1,373)   Effects of:   Fixed asset differences 177 70 Expenses not deductible for tax purposes 291 (70) Deductions for R&D expenditure relating to the current year (282) (300) Deductions for R&D expenditure relating to prior years - (1,937) Difference in current tax and deferred tax rates - - Other permanent differences (349) (506) Deferred tax not recognised 1,444 1,933 Total tax (credit) / charge for period (148) (2,183)   The Group received two payments in the year in relation to claims made in the prior year for UK research and development tax relief that resulted in receipts totalling £1,243,000. As a result of the successful claims made, management believe that a claim for this accounting period will mean a receipt for the sum of £250,000 is probable in the next accounting period and as such have recognised a receivable of the same amount.   6 Earnings per share         2025 2024           Basic weighted average number of shares 64,712,974 64,677,667         Fully diluted weighted average number of shares 64,712,974 64,677,667       2025 2024     £000 £000       Loss for the year attributable to owners of the Group (5,569) (3,309)   Basic and diluted loss per share (pence) (8.6p) (5.1p)   The loss per share has been calculated using the loss for the year and the weighted average number of ordinary shares outstanding during the period.   Share options held at the year-ended 31 July 2025 are anti-dilutive and so have not been included in the diluted earnings per share calculation. 7 Intangible assets                 Assets in the course Customer Internal software         Group of construction relationships development Software Goodwill Total     £000 £000 £000 £000 £000 £000   Cost At 1 August 2024 1,032 335 18,219 280 1,263 21,129 Additions 40 - 2,065 - - 2,105 Transfers (1,072) - 1,072 - - - Disposals - - (5,728) - - (5,728)   At 31 July 2025 - 335 15,628 280 1,263 17,506                   Amortisation At 1 August 2024 - 335 10,691 280 397 11,703 Charge for year - - 2,716 - - 2,716 Impairment - - - - 866 866 Disposals - - (5,728) - - (5,728)   At 31 July 2025 - 335 7,679 280 1,263 9,557                   Net book value At 31 July 2025 - - 7,949 - - 7,949 At 31 July 2024 1,032 - 7,528 - 866 9,426   Goodwill relates to the acquisition of Hubcreate Limited on 18 February 2016. The goodwill all relates to the Operate cash generating unit (CGU).   Capitalised internal software development costs relates to both the essensys CGUs, the first CGU being essensys Platform and the second CGU being Operate. The amounts specific to each CGU can be separately determined. Management do not consider elumo to be a separate CGU.    The Group estimates the recoverable amount of the Operate CGU using a value in use model by projecting pre-tax cash flows for the next 5 years. The key assumptions underpinning the recoverable amount of the CGU are forecast revenue and forecast EBITDA. The forecast revenues in the model are based on management's past experience and future expectations of performance. The post-tax discount rate used in all periods is 14% derived from a WACC calculation and benchmarked against similar organisations within the sector. Management do not anticipate this CGU providing long term future cash flows for the group. As such the latest projection shows an average 15% decline in revenue year on year, which is consistent with the average decline in revenue over the last three financial years. Using a discount rate of 14% (2023: 14%) has resulted in an additional impairment, and as such the remaining goodwill has been fully impaired, with an additional impairment charge recognised in the year of £866,000 (2024: £nil).   The Directors consider that, based on their projections which incorporate an estimated rate of revenue decline, no impairment charge should be recognised against the carrying value of capitalised development costs of £678,000 (2024: £818,000) allocated to the Operate CGU and which represents its carrying value, which is considered its recoverable amount.   The Group estimates the recoverable amount of the essensys Platform CGU using a value in use model by projecting pre-tax cash flows for the next 5 years including a terminal value calculation after the fifth year. The key assumptions underpinning the recoverable amount of the CGU are forecast revenue and forecast EBITDA. The forecast revenues in the model are based on management's past experience and future expectations of performance. The long-term growth rate used in the value in use calculation was 7.5%, with sensitivity analysis also performed to consider the impact of lower rates of growth. When taking into account current and projected near-term performance of the Platform CGU, the short and long-term growth rate would need to fall below 0% to remove any headroom between value in use and current carrying value. The post-tax discount rate used in all periods is 14% derived from a WACC calculation and benchmarked against similar organisations within the sector. Using a discount rate of 14% resulted in no impairment of the essensys Platform CGU.   The asset in course of construction capitalised this year is the cost for development of the software for the Group's dynamic access control solution, elumo. The asset has now been launched and so costs have been transferred to Internal software development from Assets in the course of construction.                       Assets in the course Customer Internal software         Group of construction relationships development Software Goodwill Total     £000 £000 £000 £000 £000 £000   Cost At 1 August 2023 622 335 16,552 280 1,263 19,052 Additions 410 - 1,667 - - 2,077 Transfers - - - - - -   At 31 July 2024 1,032 335 18,219 280 1,263 21,129                   Amortisation At 1 August 2023 - 335 7,981 280 397 8,993 Charge for year - - 2,710 - - 2,710 Impairment - - - - - -   At 31 July 2024 - 335 10,691 280 397 11,703                   Net book value At 31 July 2024 1,032 - 7,522 - 866 9,426 At 31 July 2023 622 - 8,571 - 866 10,059 8 Events after the reporting date   As announced on 28 November 2025, Mark Furness, founder and a Non-Executive Director, submitted a preliminary, indicative, non-binding proposal relating to a possible all-cash offer for the entire issued and to be issued share capital of the Company at 20 pence per share. Preliminary discussions regarding the possible offer are at an early stage, and there can be no certainty that an offer will be made.   9 Notes supporting statement of cash flows   9 A    Cash from operations                   2025 2024     £000 £000 Cash flows from operating activities     Loss for the financial year before taxation (5,717) (5,492)     Adjustments for non-cash/non-operating items:   Amortisation of intangible assets 2,716 2,710 Depreciation of property, plant and equipment 569 765 Depreciation of right of use assets 1,046 1,247 Impairment of goodwill 866 - Movement in expected credit loss provision 283 153 Inventory obsolescence provision 180 290 Share based payment expense 325 (448) Losses on foreign exchange transactions 32 (5) Finance income - (21) Finance expense 82 133 Other 94 (160)   476 (828)   Changes in working capital:   (Increase)/decrease in inventories (24) 1,082 Decrease/(increase) in trade and other receivables 1,177 (1,497) Decrease in trade and other payables (610) (767)     Cash generated from/ (used by) operations   1,019 (2,010)                             9 B Movement in net debt                     Cash and cash equivalents Leases Total           £000 £000 £000     As at 31 July 2023 7,862 (1,571) 6,291     Lease additions - (1,074) (1,074)   Effect of modifying lease term - (293) (293)   Cashflow (4,699) 1,592 (3,107)   Interest charge - (86) (86)   Exchange movements (62) (8) (70)         As at 31 July 2024 3,101 (1,440) 1,661                         Lease additions - (211) (211)         Effect of modifying lease term - 31 31         Cashflow (1,302) 999 (303)         Interest charge - (60) (60)         Exchange movements (18) 8 (10)         As at 31 July 2025 1,781 (673) 1,108                           Cash and cash equivalents     Leases Total           £000 £000 £000                         Balances as at 31 July 2025                               Current assets 1,781 - 1,781         Current liabilities - (673) (673)         Non-current liabilities - - -           1,781 (673) 1,108     Cash and cash equivalents     Leases Total     £000 £000 £000         Balances as at 31 July 2024         Current assets 3,101 - 3,101     Current liabilities - (1,008) (1,008)     Non-current liabilities - (432) (432)     3,101 (1,440) 1,661        

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