Sidetrade: Resilient operating profitability, at 12%, despite
increased investments in North America
Record bookings
- €5.84 million in new Annual Contract Value: +21%
Robust growth in revenue, up 17%
- Strong increase in Order-to-Cash SaaS subscriptions:
+21%
- Surge in revenue in the United States: +45%
- Increasing demand from multinational corporations:
+46%
Resilient operating profitability, at 12%,
despite €3.8 million investments in North America
Solid financial position
Reinforced commitment to responsible growth
with a full CSR assessment
Sidetrade, the global leader in AI-powered
Order-to-Cash applications, today announces robust revenue
growth in the first half of 2023, up 17%, with a 22% increase in
SaaS subscriptions and double-digit profitability at 12% of revenue
despite increased investment and a reinforced commitment to
responsible growth through an in-depth CSR assessment.
Profitable growth model
Sidetrade (€m) |
H1 2023 |
H1 2022 |
Change |
Revenue |
20.9 |
17.8 |
+17% |
of
which 'Order-to-Cash' SaaS subscriptions |
17.4 |
14.3 |
+21% |
Gross margin |
16.9 |
14.2 |
+19% |
as a % of Revenue |
81% |
80% |
|
Operating expenses (OPEX) |
(14.4) |
(11.8) |
+22% |
of which North America |
(3.8) |
(2.7) |
+41% |
Operating profit |
2.5 |
2.4 |
+2% |
as a % of Revenue |
12% |
14% |
|
Net profit |
2.2 |
2.3 |
-8% |
2023 information is from consolidated, unaudited data.
Olivier Novasque, CEO of Sidetrade commented:"In
H1 2023, Sidetrade reported an all-time high in bookings, with
nearly €6 million in new Annual Contract Value, representing an
increase of more than 20%. This performance was all the more
remarkable for two reasons. On the one hand, it was achieved in a
market environment of cautious major contractors. On the other, it
followed a demanding base effect with record bookings for Sidetrade
in H1 2022. Our ambitious investment policy is now paying off, with
the goal of 1/ accelerating our development in North
America, 2/ expanding our AI-based product offering
to provide the most comprehensive Order-to-Cash software suite on
the market, and 3/ targeting multinational companies with
revenue over $1 billion. By simultaneously implementing all three
of these strategic decisions, we have increased our credibility,
boosted our appeal to major customers, and ultimately, won multiple
contracts internationally.To date, the United States represents a
robust growth driver, with revenue up 45% for the period. What's
more, our newly launched CashApp solution helped us win tenders the
world over. Lastly, the share of subscriptions with companies
generating $1 billion-plus revenue now accounts for 76% of
Sidetrade's total subscriptions. In the months ahead, we must
continue our efforts while staying focused on our development model
that combines growth with profitability."
Record first half in 2023 with nearly €6
million in bookings in new Annual Contract Value, up 21%
Sidetrade (€m) |
H1 2023 |
H1 2022 |
Change |
New SaaS
subscriptions (New ARR) |
3.30 |
3.04 |
+9% |
Services bookings |
2.54 |
1.77 |
+44% |
New Annual Contract Value (ACV) |
5.84 |
4.81 |
+21% |
2023 information is from consolidated, unaudited data.
In H1 2023, Sidetrade delivered its
best-ever performance in bookings with new Annual Contract Value
(ACV) of €5.84 million, up 21% versus H1 2022
despite a challenging base effect since the latter period already
set an historic record for the Group with €4.81 million
in ACV.
New SaaS bookings totaled €3.30
million, mainly driven by an exceptional Q2 2023 when Sidetrade
achieved the best quarterly performance in its history with €2.41
million in New Annual Recurring Revenue ("New ARR") signed in one
quarter. Parallel to this, services bookings (with almost
all invoiced within twelve months of their signing) totaled
€2.54 million, up 44% compared to H1 2022. This
performance is largely due to the growing number of deployment
projects signed worldwide.
In H1 2023, the initial contract period for
new customers (excluding renewals) rose to 44.8 months
versus 43.2 months a year earlier, demonstrating new
customers' confidence in Sidetrade. This extended contract period
increases the economic model's strong predictability. Attrition
remained extremely low for the industry (generally around 10%) with
a churn rate of 2.51% at the end of the first half.
Sidetrade's winning strategy: Ramp-up in new
global contracts
The commercial successes in recent months
validate Sidetrade's strategic decision to target companies
generating revenue in excess of $1 billion. As such, this
first-half performance is largely attributable to the ramp-up in
new global contracts with multinationals including Bayer AG, BIC,
NIELSENIQ and Dassault Systèmes. Sidetrade benefits from 1/
a technological edge in artificial intelligence,
2/ increased credibility with a significant
foothold on both sides of the Atlantic to implement and support
international contracts, and 3/ an effective
salesforce that fosters collaboration between teams in Europe
and North America.Sidetrade also cemented its market position
following Gartner's recognition for the second year in a row as one
of the global Leaders for Integrated Invoice-to-Cash
applications.
Expansion of Sidetrade's offering: a complete
suite for Order-to-Cash cycle and the success of CashApp
Another crucial factor behind this first-half
performance is the expanded AI offering which aims to transform
Sidetrade's platform into the most comprehensive Order-to-Cash
software suite on the market. It includes paperless order
processing, real time credit risk management, electronic invoicing,
dunning and dispute resolution as well as reconciliation of
payments. With respect to the latter, Sidetrade secured its first
contracts thanks to its all-new CashApp solution which automates
the reconciliation of customers' banked payments with open invoices
by leveraging the capabilities of machine learning and deep
learning algorithms. CashApp was a resounding success among major
customers such as Bayer AG and BIC who both opted to deploy the
application worldwide.
In H1 2023, bookings by new customers ("New
Business") accounted for 62% of the total new bookings
while Cross-selling represented 13% of total new
bookings, with the remaining 25% of bookings driven by
Upselling of additional modules to existing customers.
Robust growth in revenue, up 17%, with SaaS
subscriptions up 21%In H1 2023, revenue for 'Order-to-Cash'
SaaS subscriptions continued its brisk growth, up
21%.
Sidetrade's revenue topped the €20 million mark
for the first time in a half year, totaling €20.9 million, an
increase of 17% compared to the same period in the previous fiscal
year. This growth is attributable to two factors:
- Expansion in the United States
In H1 2023, the United States was a growth
driver for Sidetrade, posting revenues up 45%. As a result of this
successful expansion, international markets now represent
57% of the Company's total revenue, including 27% in
North America. Going forward, the United States will continue
to be pivotal for Sidetrade's growth.
- Increasing demand from multinational corporations
Analysis of customer profiles for
'Order-to-Cash' activities is underpinned by impressive growth
of 46% in subscriptions with multinational corporations on
annual contracts in excess of €250,000. These subscriptions now
account for 42% of Sidetrade's total subscriptions and are
expected to remain an important growth driver in the months
ahead.
In H1 2023, the impact of exchange rates on
Sidetrade was not material.
Strong results in a context of accelerating
investment
Record gross margin at 81% of revenue
Sidetrade achieved a record gross margin
in H1 2023, representing 81% of total revenue, with an
impressive rate of 93% in SaaS subscriptions. This
remarkable performance results from Sidetrade's strategy to promote
its technological edge, coupled with strict cost control in an
inflationary environment.Sidetrade continues to illustrate the
robustness of its SaaS model, which generates significant
incremental gross margin, year after year.
Double-digit profitability at 12%, despite
investment of €3.8 million in North America
Operating profit for H1 2023 totaled €2.5
million (vs. €2.4 million in H1 2022), representing 12% of
revenue. Profitability slightly increased, remaining in double
digits under the combined impact of vigorous revenue growth, an
excellent gross margin and efficient cost control.
Bolstered by its robust economic model,
Sidetrade stepped up investment in North America, which amounted to
€3.8 million in H1 2023, up €1.1 million compared to the same
period in the previous fiscal year. This investment mainly focused
on building a regional team of more than 50 colleagues.
Operating profit for H1 2023 includes a French
Research Tax Credit of €1.3 million, equivalent to that of H1 2022,
as well as activation of €0.2 million in marginal R&D costs. It
should be noted that H1 2022 included an innovation subsidy
(EuroFirmo project) of €0.5 million. Restated for this exceptional
item, operating profit would have increased by €0.6 million, up
25%.
Corporate income tax for H1 2023 totaled €0.3
million, versus €0.2 million a year earlier.
All told, Sidetrade's net profit for H1 2023
was almost stable at €2.2 million, demonstrating that continued
growth and profitability are achievable while strategically
investing.
Note that the acquisition of CreditPoint
Software on June 30, 2023, will be consolidated into the Group's
financial statements from July 1, 2023.
Solid financial positionOn June 30, 2023,
Sidetrade reported €24.2 million in gross cash (vs. €20.4
million on December 31, 2022). As of June 30, 2023, the Company
also holds 86,000 of its own shares with a value of
€12.1 million.
Sidetrade's financial debt stands at €11.4
million (fixed rate at 1.1%), giving the Group significant
investment capacity to accelerate its expansion.
Reinforced commitment to responsible growth
with a full CSR assessmentIn addition to its robust financial
results, Sidetrade is committed to a CSR (Corporate Social
Responsibility) approach. The latter centers on integrating ESG
(Environmental, Social, Governance) challenges into its company
strategy.
While Sidetrade is not yet bound by regulatory
requirements, as an industry-recognized leader, the Company
understands the significant role it has in shaping a more
responsible and sustainable future. Against this background,
Sidetrade has already performed a comprehensive Carbon
Assessment (scopes 1, 2 and 3) for FY 2022, which applies to
activities and regions across the board. This assessment helped the
Group to pinpoint the main greenhouse gas emission sources and
identify concrete actions to regulate them.
On top of this, Sidetrade published its
first-ever CSR report (in compliance with the European Union's new
Corporate Sustainability Reporting Directive – CSRD), showcasing
its commitment towards corporate sustainability (see press release
of July 26, 2023). Through this approach, the Company is convinced
that it will further cement its industry-leading position.
Next financial
announcementThird Quarter Revenue for 2023: October 17, 2023,
after the stock market closes.
Investor
relationsChristelle Dhrif
00 33 6 10 46 72
00
cdhrif@sidetrade.com
Media
relationsBecca
Parlby
00 44 7824 5055
84
bparlby@sidetrade.com
About Sidetrade
(www.sidetrade.com)Sidetrade (Euronext Growth:
ALBFR.PA) provides a SaaS platform dedicated to securing and
accelerating cash flow. Sidetrade’s next-generation AI, nicknamed
Aimie, analyzes $4.6 trillion worth of B2B payment transactions
daily in the Sidetrade Cloud to predict customer payment behavior
and the attrition risk of more than 21 million companies worldwide.
Aimie recommends the best cash collection strategies, intelligently
automates actions on the Order-to-Cash process, and dematerializes
customer transactions to enhance productivity, performance, and
working capital management. Sidetrade has a global reach, with 300
talented employees based in Paris, London, Birmingham, Dublin,
Houston, Calgary, and Tulsa serving global businesses in more than
85 countries. Amongst them: Tech Data, KPMG, Nespresso, Hearst,
Expedia, Criteo, Manpower, Securitas, Randstad, Engie, Veolia,
Inmarsat, and Bidfood.Sidetrade is a participant of the United
Nations Global Compact and adheres to its principles-based approach
to responsible business.
For further
information, visit us at www.sidetrade.com and follow us on Twitter
@Sidetrade.
In the event of any
discrepancy between the French and English versions of this press
release, only the French version is to be taken into account.
- Sidetrade: A double-digit profitability at 12% of revenue
despite increased North America investment
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