Altitude delivers excellent growth in Throughput Revenues
Altitude Group plc (AIM: ALT), the operator of a leading marketplace for personalised products, announces its unaudited results for the six months ended 30 June 2018.
AIMPro & ThinkPromoNow (ChannlPro) Progress Update
- Increasing engagement of AIM members as at 16th September 2018:
- 258% growth in the value of sales orders processed to $9.9m in last 16 weeks
- 73% of Members Processing Orders (“MPO’s”) have placed repeat orders
- 392% growth in the number of sales orders processed to 11,123 in last 16 weeks
- 188% growth in MPO’s to 164 in the last 16 weeks
- 40% of AIM’s 1,857 members are now actively engaging with US team
- Current 8 week average order value per week $487,000
- 1,000 e-commerce websites built by AIM members
- AIMPro officially launched in late January 2018 to the AIM buying group
- 65 AIM preferred suppliers signed up, including 14 of the top 30 US promotional product suppliers
- Order processing began in August through Think Promo Now, the ChannlPro solution for US commercial printers launched through our partnership with NAPCO Media in late August 2018 and first users on-boarded
Financial highlights
- Revenues increased by £0.8m to £3.8m (H1 2017: £3.0m) due to £1.6m of incremental revenue from a full six months of AdProducts (H1 2017: one month), less a £0.8m decline in exhibitions and publications revenues
- Reported operating loss of £0.7m (H1 2017: profit £0.5m), driven by a £0.5m operating cost investment in the US, and an £0.8m decline in UK exhibitions and publications contribution, both of which were broadly in line with expectations
- Technology gross margin maintained at 80.2% (H1 2017: 80.3%)
- Total administrative expenses increased by £1.1m to £2.8m (H1 2017: £1.7m). The increase comprised of £0.5m of operating cost investment in the US and £0.8m of incremental costs from a full six months of AdProducts
- Loss before taxation £0.7m (H1 2017: profit £0.5m)
- Group remains free of bank borrowing, with net cash resources of £1.3m as at 30 June 2018 (31 December 2017: £1.9m)
- Equity fund raise of £1.4m (net of expenses) in March 2018 to accelerate rollout of AIMPro
Other Operational Highlights
- Nichole Stella appointed as CEO and Graeme Couturier appointed as CFO
- January 2018 – full launch of AIMProTech Suite (“AIMPro”) trading platform for AI Mastermind (“AIM”), the largest and fastest growing promotional products distributor group in the US now comprising 1,857 distributors with aggregate revenues of $1.6bn
- August 2018 – partnership with NAPCO Media leading to the launch of Altitude’s second ChannlPro solution, ThinkPromoNow, targeting the US commercial printer industry
- Establishment of a dedicated US based ‘on-boarding’ and ‘customer engagement management team’ for all ChannlPro solutions
Nichole Stella, Chief Executive Officer, commented: “After just a few months of stepping into the role of CEO, the singular global focus of Altitude Group Plc is strategically very clear. The mission is to deliver throughput on a data driven technology platform that allows suppliers to sell products to end-buyer businesses, whether through our white-labelled distributor reseller channel, AI Mastermind, Think Promo Now or additional platforms launched from our foundation e-commerce solution – Channl.
In the U.S., I am pleased to see consistent, exponential user-ship growth on our AIMPro platform, and the take-up from commercial printers on Think Promo Now. A key initial area of concentration has been building user loyalty to the platform. This strategy continues to show good results as referenced by the high levels of repeat usage and order values. Our technology is proving to be attractive to adjacent markets and we look forward to continuing to rapidly grow commercial agreements and forging additional strategic partnerships in both the US and the UK.
As noted above, the AIMPro Tech Suite is gaining traction with the members week-by-week, driven by a variety of factors; strong demand; an increasing supplier base and consistent support from our US engagement team. I am also enthused by the increase in member e-commerce website builds and repeat order frequency once members are on-boarded.
Altitude has gained significant traction in revenue throughput across AIMPro since launch and we look forward to reporting further strong progress in the months ahead. Monetisation of throughput in the period has been slower than anticipated, this has been due to relevant timing of supplier agreements and subsequent data updates (which are now resolved), and while it will impact revenue and profit expectations in the current year the Board continues to be very confident, given the KPI metrics, in the potential of the business.”
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