Defenx PLC (LON:DFX) Chief Financial Officer Philipp Prince caught up with DirectorsTalk for an exclusive interview to discuss their latest trading update, Memopal, channel partners, Café Bazaar and their goals for 2017
Q1: Now, Defenx PLC have just published a trading update, Philip can you talk us through the highlights?
A1: Yes, certainly. Firstly, we confirmed continued revenue growth which was obviously our key target and that’s 57% organic growth driven by new products and new channel partners that we’ve announced during 2016 and then 63% if you include the 5-month contribution from Memopal. We also confirmed a further strengthening in our operating margins as we’d anticipated in last years’ annual report so all that to say the full year 2016 results are in line with management’s expectations so we’re very pleased with that.
Q2: Now you talk about bedding in Memopal, how has the integration process gone? What’s the acquisition brought Defenx?
A2: Memopal really brought us three key things:
– The first was some great cloud, sync and backup IP
– Secondly, reference customers like Turk Telecom (Turk Telekomunikasyon A.S. – IST:TTKOM) which gets us into a new market, Turkey, and Western Digital Corp (NASDAQ:WDC)
– Third, it brought us technical people
So far, we’ve really focussed on winning new customers, for example Memopal helped us sign up Dylog Italia SpA (Gruppo Buffetti SpA), one of the channel partners we announced last year, and the continue to introduce us to new parties. That’s been the primary focus and drive for the last few months but at the same time our enlarged team members are getting to know each other better and they continue to deliver great software. So, we really hope to be able to give more insight into Memopal, how it’s going and what it’s contributing to the group in our 2016 results that we’ll publish in early April.
Q3: You said when you IPO’d you’d be looking to broaden your channel partner network, can you talk about how this has grown through 2016? Could you give us a little bit more detail around the Café Bazaar agreement?
A3: Channel partners, we had 4 or 5 large substantial channel partners at the time of the IPO and went into 2016 with them and during 2016 we announced 8 new significant channel partners with real potential and we acquired 2 with Memopal. So, the way we count it we say we have about 15 proper substantial channel partners now as we go in 201. So, that virtually triples the number of partners we have but it’s not really their numbers, it’s their scale and reach, many of these new channel partners give us access to the SME smaller corporate market which is a significant target growth area for us.
In terms of Café Bazaar, we think this is really exciting. Now that most of the Iranian sanctions have been lifted, our listing on this local android play store really does show how our channel partner network delivers. We’ve got distribution far quicker with a lower risk than trying to do it ourselves directly and it’s in a high gross market, completely consistent with our strategy so we really think this is the beginning of something exciting in Iran.
Q4: Finally Philipp, what are Defenx PLC’s goals for 2017?
A4: Well I’d sum it up in three things, the first is to make some real progress in the SME smaller corporate market, forthcoming product launches, mobile device management and a new PC security suite to be launched this coming year will really help drive us there. Number two, it’s growing revenues from cloud backup, the software we acquired from Memopal, channel partners have consistently been very interested in this and we now hope to see significant growth in 2017. Thirdly, we’ll continue to expand the management team to bring in new skills and experience. So, the three of those we think will really ensure that we can deliver another great year of strong results in 2017.
