It is my pleasure to welcome you to the Company’s annual report for the year to 31 March 2019. It has been another strong year of progress for the Group with growth in all key adjusted financial metrics, as has been the case in each reporting period since the Company listed on AIM in 2014.
Group revenue and gross profit have grown by 28% to £142.7m, and 23% to £62.6m respectively. Adjusted EBITDA has increased by 35% to £18.0m. Cash generation was also very strong, with 94% of adjusted EBITDA converting to adjusted cash generated from operations. On a statutory basis, operating profit decreased by 64% to £1.0m after charging contingent consideration related expenses, acquisition costs and amortisation of acquired intangibles of £13.0m.
In the period since listing, the Group has performed extremely well, delivering a 5-year revenue CAGR of 27%, 5-year gross profit CAGR of 18% and a 5-year adjusted EBITDA CAGR of 20%.
We have maintained our track record of organic gross profit growth, in spite of the well-publicised headwind from a single customer in the Middle East and Africa region. Our operations in Europe & Americas and Asia Pacific regions have performed very well in the year to 31 March 2019 with constant currency gross profit growth of 16% and 14% respectively.
We have strengthened our market leading position in the UK and South African digital communications markets, adding customers and contracts in banking, mobile operator, utilities, logistics, hospitality and healthcare verticals. We have also obtained a market leading position in the Canadian market, following the acquisition of Impact Mobile in July 2018 and continue to search for further opportunities to strengthen our position in the important North American market.
The Management team continues to execute on the Group’s strategic growth plans:
i. growing the share of interactions and customer journeys with existing accounts;
ii. accelerating market penetration through partnerships;
iii. introducing new innovative customer engagement technologies; and
iv. leveraging acquisitions for market distribution.
We have enhanced our leading Enterprise CPaaS position by launching services which leverage new communications channels including Apple Business Chat, Rich Communication Services (“RCS”) and WhatsApp Business.
The acquisitions we have made have also continued to perform strongly. Successful up-sell and cross-sell to the customers of the businesses we have acquired are expected to continue to contribute to the Company’s ongoing success.
The Board continues to monitor the status of Brexit and it remains our view that we do not think it will have a material impact on the Group’s global operations.
It is incumbent on me to thank all the individuals across our growing Group for their loyalty, hard work and commitment which underpins our successes over the years. I am confident in the people we employee and their ability to maintain the progress of the last few years.
The current financial year has started well, and the Group is well positioned with a fantastic set of customers, motivated and experienced management team and leading product capability to take advantage of the opportunities for growth that exist in all geographies in which we operate.