LOOPUP GROUP PLC
(“LoopUp Group” or the “Group”)
LoopUp Group plc (AIM: LOOP), the premium remote meetings company, is pleased to provide the following trading update.
Business performance materially ahead of expectations:
In our preliminary results statement on 19 March 2020, we noted a material increase in business volumes, driven by the large-scale migration towards working from home since mid-March associated with the Covid-19 outbreak.
As a result, year-to-date Group revenue from January through April 2020 is at least 40% higher than the same period last year, driven by:
· Existing customers, where users have been more active and additional new users have been deployed;
· New customers switching to LoopUp, very often after having experienced reliability issues with their incumbent product relating to VoIP-based audio over the public internet; and
· Increased usage of multi-media capabilities in the LoopUp product, including a disproportionately high increase in video usage;
· Materially more events hosted on our ‘Event by LoopUp’ platform.
With gross margins stable and overheads broadly in line with market expectations, we expect EBITDA to be accordingly higher in that same year-to-date period.
Since mid-March, leading pre-revenue business indicators have also been strong:
· Inbound leads into the company are running at approximately 4x pre-outbreak levels; and
· New customer contracts signed are running at approximately 2x pre-outbreak levels.
Our strategic product focus on reliability, security and simplicity is proving to be in strong demand. We remain focused and incredibly busy, helping to keep our customers safely connected from home in these challenging times. Our team is working hard to ensure our global platform capacity remains comfortably above demand level as our customers, many of which are major professional services firms, are relying on us as a business-critical means of secure communication. We are proud of the role we are playing, which includes providing service to approximately 20 NHS trusts, currently on a pro bono basis.
The Group closed April trading with a cash balance of £3.1 million and net debt of £11.4 million. We expect this net debt position to improve materially by the end of the first half of the year, based on higher cash receipts flowing through, predominantly on monthly post-paid, 30-day terms.
At the end of Q1 2020, the Group’s gross debt stood at approximately 1.5x trailing 12 months EBITDA, comfortably within the 2.75x covenant level, and we expect this ratio to improve further as the year progresses.
Business performance remains strong and leading indicators remain positive. It is, nevertheless, difficult to predict how long the current period of large scale home-working will continue, and indeed where business volumes will settle thereafter. At this point in the year, the Group is confident of exceeding current market expectations in terms of revenue, EBITDA and cash generation for the current financial year. However, just four months into the financial year, it is difficult to provide more specific guidance.
Steve Flavell and Michael Hughes, co-CEOs of LoopUp Group, commented,
“We are incredibly proud to be helping our customers with their business-critical communications in these challenging times, by providing simple, reliable and secure products that are diligently operated and supported. We would like to thank our team for their incredible and ongoing efforts. We experienced one day when our business volumes increased more in that single day than in the first 10 years of the company’s life. The team has delivered a resilient platform that has stood firm with no major service outages, as well as maintaining their high standards of customer care in the face of heavily elevated demand and volumes across our operations. And all while working from home themselves.”
Market abuse regulation:
This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014.
For further information, please contact:
LoopUp Group plc
Steve Flavell, co-CEO
Panmure Gordon (UK) Limited
+44 (0) 20 7886 2500
Dominic Morley / Alina Vaskina (Corporate Finance)
Erik Anderson (Corporate Broking)
Numis Securities Limited
+44 (0) 20 7260 1000
Simon Willis / Jonny Abbott (Corporate Finance)
FTI Consulting, LLP
+44 (0) 20 3727 1000
Matt Dixon / Emma Hall / Jamille Smith / Shamma Kelly
About LoopUp Group plc:
LoopUp (LSE AIM: LOOP) is a premium remote meetings solution. The solution provides a reliable, secure and incredibly simple experience that is optimised for external guests on business-critical meetings, such as professional services firms’ communications with their clients. Over 5,000 organisations worldwide trust LoopUp’s award-wining SaaS solution with their remote meetings, including more than 20 of both the world’s top-100 law firms and top-100 private equity firms, as well as enterprises such as Travelex, Kia Motors, Planet Hollywood and National Geographic. The Group is headquartered in London, with offices in San Francisco, New York, Boston, Chicago, Dallas, Los Angeles, Denver, Cardiff, Milton Keynes, Madrid, Berlin, Malmo, Hong Kong, Sydney and Barbados, and is listed on the AIM market of the London Stock Exchange (LOOP). For further information, please visit: www.loopup.com.