Falanx Group Limited (LON:FLX), the global cyber security and intelligence services provider, has today announced its audited results for the year-ended 31 March 2018.
Financial Highlights
· Revenues increased to £3.0m (2017: £2.7m) and gross margin increased to 31% (2017: 20%)
· Contribution from monthly recurring revenue increased to 62% of revenue (2017: 55%). Monthly recurring revenue run rate at 31 March 2018 was £0.19m (2017: £0.15m)
· Much greater future revenue visibility (contracted plus deferred income) £3.0m (2017: £1.8m)
· Underlying EBITDA loss £1.6m (2017: £1.2m), reported loss £2.5m (2017: £1.7m) with £0.7m of one off restructuring and transaction costs
· Cash balances £0.9m (2017: £0.4m)
· Shareholders’ funds £4.9m (2017: £0.8m) and the Company remains debt free
Operational Highlights
· Acquisition of three technology and cyber security focussed companies; Cloudified, AuditSec, First Base
· Substantially increased and diversified customer base across all lines of service
· Creation of new cyber service lines: MidGARD Monitoring; Threat Awareness Training; and Red-Team Testing
· Significantly strengthened management team
· Continued proprietary cyber technology development
Post Period Highlights
· Monthly recurring revenue at the end of July 2018 has increased to £0.24m
· Recent acquisitions combined with contract wins have approximately doubled proforma revenues to £6m, placing the business in a strong position to exploit growth
· EBITDA Profitability in July 2018 following strong deliveries
· Acquisition and integration of trade and assets of First Base Technologies LLP, providing significantly increased Cyber Assessment and Awareness services, progressing well with orders up by 25% since the start of January 2018 versus the prior year
· Acquisition of Securestorm Limited, enhances Cyber Consultancy and extends reach into UK Government was completed in July
Outlook
The Board has received favourable indications from our most significant partners and vendors that our strategy to scale our security services is appropriate and will be supported. As such, the Board targets a much-improved financial performance for this year. In addition to our ‘business as usual’ plan which combines organic growth and targeted acquisitions that are financially attractive, the Group will:
· Increase the contribution from high quality recurring revenues
· Increase average customer spend through bundled products
· Increase sales by distributing through large Managed Service Providers (MSPs)
· Utilise proprietary technology development to drive down cost and add attractive new features
· Progress current discussions with several major global enterprises for adoption of our highly disruptive cyber technology stack
Falanx Group Limited Chairman and Chief Executive Mike Read, commented: “In the past 8 months we have: significantly increased revenues through contract wins and acquisitions, restructured our management team, refocussed our strategy, won important and large customer contracts, broken into new markets, acquired and integrated several businesses, built a strong team, forged new channel partnerships, successfully delivered large scale security solutions and deepened our intelligence and security relationships with global clients. Because of all the work done by our energetic and committed team, I am delighted to announce, following strong deliveries, Falanx Group has achieved EBITDA profitability this July, in-line with management expectations.”
