Full Year Trading UpdateJanuary 28, 2014
FOR IMMEDIATE RELEASE
28 January 2014
GLOBO Plc (“Globo” or the “Group”)
Full Year Trading Update
Globo plc (LSE-AIM: GBO), the international provider of enterprise mobility management and telecom software products and solutions, today issues a Trading Update for the full year ended 31 December 2013.
The Board is pleased to report that Globo has achieved a strong financial performance for 2013, ahead of market expectations.
· Revenues for the full year from continuing operations grew 57% to €72 million (2012: €46 million)
· Profits will be in line with market expectations
· Growing sales of GO!Enterprise resulted in an increased operating profit cash conversion ratio of around 80% for the full year
· 2013 will be the second consecutive year of positive free cash flow, before the impact of acquisitions
· Globo’s year-end cash position was €64 million (2012: €19 million) and net cash position was €42 million (2012: €14 million)
· GO!Enterprise generated sales of close to €31 million, a year-on-year increase of approximately 155% (2012: €12 million).
· The Group’s consumer mobile portfolio (CitronGO! and GO!Social) achieved revenues of €35 million for the year, a year-on-year increase of approximately 21% (2012: €29 million)
2013 was an important and successful year for Globo. The positive financial and operating performance is a result of continued strong demand for Globo’s mobile consumer and enterprise products, driven in particular by the growing BYOD (Bring Your Own Device) business trend and multiple mobile applications increasingly in demand by corporations at all levels.
Notable operating developments during the year include:
Notify Technology integration and commercial progress
Notify Technology Inc., the US Mobile Device Management (“MDM”) provider, acquired in October 2013, has been successfully integrated. Under Globo’s ownership Notify has both retained and built on customer relationships including Novell, Oracle and all its reselling partners. As we have noted MDM functionality represents an important competitive addition to our mobile Enterprise offering. Based on this platform we have initiated a recruitment procedure with a focus in ramping up our sales and technical presence in the US.
Ingram Micro distribution agreement for GO!Enterprise in a Box
Following the initial launch in July and a marketing build up from August to December our collaboration with Ingram Micro resulted in several new partnership agreements (including Dell, CDW and TigerDirect), with a total of approximately 1,200 Boxes sold by year-end. This figure is consistent with our initial expectations, due to the time taken to subscribe resellers who will integrate our go-to-market propositions. We anticipate that demand through this channel will continue to grow as our marketing efforts take effect, and we believe there is potential for sales to scale up significantly during the current year.
Disposal of stake in Globo Technologies S.A.
The Group has received payment of €1,008,151 from GMBO Holdings Ltd., comprising €500,000 of principal and €508,151 in interest due, in respect of the Group’s divestment of 51% of Globo Technologies S.A., the e-business and software service, which was completed on 3rd December 2012. This instalment was received slightly earlier than expected and maintains the schedule of payment which is due for completion in December 2016.
Globo Technologies S.A., reports that it has signed contracts for digitalisation-related development projects worth a total of €11 million, maintaining the momentum of strong business performance reported earlier in the year.
Product development and expansion
We have continued to invest and develop the GO!Enterprise offering by incorporating new features that include Mobile Device Management and Cloud deployment. In addition we have released V.2 of our Application Development Platform, GO!AppZone, which supports a new development studio featuring full HTML5 coding capabilities, a cloud builder for native mobile apps for iOS, Android, BlackBerry, Windows Phone and Windows8 platforms, and a server layer to enable apps distribution and operation.
Our product roadmap remains busy with further innovations planned for 2014.
Following the publication of our interim results and the acquisition of Notify Technology, we successfully raised (net) £23 million (€27 million) in a placing of new shares to existing and new institutional investors. The placing was oversubscribed and has resulted in further strengthening of Globo’s balance sheet to accelerate its international growth strategy.
Following completion of a €25 million debt facility with Barclays we have extended available debt facilities via East West United Bank Luxembourg bringing the total to €45 million, as the basis for potential acquisitions and development.
Outlook for 2014:
Globo is focused on ongoing expansion across Western Europe and the US through organic growth and targeted acquisitions.
Both the MEM (Mobile Enterprise Management) – driven by BYOD and MADP (Mobile Application Development Platform) markets are expected to grow substantially over the course of the next 4 years. In 2012 IDC sized the total MEM market at $798 million and the MADP market at $938.6 million. Forecast growth by 2017 is for 21.9% CAGR to reach $2.2 billion for the MEM market and 38.7% CAGR to reach $4.8 billion for the MADP market. Globo is well positioned to claim market share in these areas.
Significant investment in sales and marketing will allow us to grow our customer base and develop further recognition of our brand across the market. In addition to our already successful strategy of distribution via partners such as software vendors, integrators, consultants and mobile handset manufacturers, we will also focus on direct sales to the end user in 2014.
Current year trading has started very strongly and we anticipate that as IT budgets from customers start to be deployed and BYOD and mobile apps needs increase further, Globo will have the opportunity to deliver another year of excellent growth and market penetration.
Globo’s Chief Executive Officer, Costis Papadimitrakopoulos, commented:
“This was a very important and successful year for Globo. We have made excellent progress in establishing a strong position in the market, through the successful integration of our recent acquisitions and the growing demand that market appetite for BYOD solutions and enterprise Apps create for our products.
We have met the challenge of maintaining both strong growth and underlying profitability and cash generation, as well as continuing to invest in our core technology. We saw particularly strong growth in cash flow from June 2013 onwards, driven by increasing sales of GO!Enterprise, which also translated into strong cash conversion and our second consecutive year of positive free cash flow, before the impact of acquisitions.
We have boosted our balance sheet through both a well-supported equity issue and access to new debt and as a result, Globo is well-placed with the flexibility to pursue a variety of options for rapid growth.”
Costis Papadimitrakopoulos, CEO
Dimitris Gryparis, Finance Director
Mike Jeremy, IRO
RBC Capital Markets
(Nominated Adviser & Broker)
Stephen Foss or Pierre Schreuder
+44 20-7404- 5959
Claire Boszko or Chris Blundell
In 2013 Globo was recognised by the following industry awards:
· “Fierce Innovation Award”for Globo’s solution “GO!Enterprise Mobility in a Box”, a unique operator-reviewed awards programme from the publishers of FierceWireless, FierceTelecom, and FierceCable
· “Ruban d’ Honneur Award”from European Business Awards including Globo within the top 100 dynamic European companies and one of the 10 European companies in the category of International Growth Strategy
· “Manager of the Year 2013”for Globo’s Founder and CEO in the Infocom World Technology Conference
· Globo’s inclusion in London Stock Exchange Group’s inaugural publication “1000 Companies that inspire Britain”