Silver Bullet Data Services Group PLC (LON:SBDS) (Silverbullet), a provider of AI driven digital transformation services and products, has announced its audited results for the year ended 31 December 2023.
FINANCIAL HIGHLIGHTS.
| YE December 2023 | YE December 2022 | Y-O-Y | |
| Revenue | £8.36m | £5.82m | +44% |
| Gross Profit | £6.36m | £4.22m | +51% |
| Headline Loss before tax* | £3.31m | £6.10m | -46% |
| Reported Loss before tax | £3.45m | £7.54m | -54% |
| Loss Per Share | £0.20 | £0.49 | -61% |
* Headline results are calculated before exceptional items and share option charges, reconciliation per note 5 of the consolidated financial statements.
Operational Highlights:
| · | Group revenue increased 44% to £8.36m (2022: £5.82m). |
| · | Services revenue increased 29% to £5.55m (2022: £4.30m). |
| · | 4D revenue increased 85% to £2.81m (2022: £1.52m) driven by US demand for the product. |
| · | US and globally operating clients now account for more than 50% of total Group revenues. |
| · | Losses significantly reduced due to revenue acceleration and cost reductions. |
Post-Period End Highlights
| · | Total Group bookings year to date are approximately £6.2m. |
| · | Committed and earned services revenues represent 69% of targeted revenues for the year to date. |
| · | 4D bookings more than doubled in Q1 24 compared to Q1 23. |
| · | Growth in services top two clients has increased (2024 vs 2023) by 43% and 26% respectively, reflecting growing demand and increased client spending on data transformation. |
| · | US and global clients contribute approximately 73% of total revenue (2023: 50%). |
| · | Net margin year to date has increased by 35% versus the corresponding period in FY 23. |
| · | Group overheads and costs remain flat year over year. |
| · | A robust pipeline of over £4m providing strong confidence for the rest of the year. |
| · | Silverbullet expects to achieve its objective of an EBITDA positive run rate entering the second half and commence generating positive operating cashflow in the current financial year. |
| · | Based on current demand for the Group products and services, the Board views the future of the business with confidence. |
Ian James, Chief Executive Officer of Silverbullet, commented: “I am delighted to see Silverbullet’s remarkable growth trajectory. Our revenue increase of 44% to £8.36m underscores the growing demand for our AI-driven digital transformation services and products. Notably, our 4D revenue increased by 85%, a testament to the continued interest in our products, particularly in the US market. Moreover, with over 50% of our revenue now stemming from US and global clients, we are solidifying our position as a key player in the international arena.
“Looking ahead, our post-period end highlights paint a promising picture, with total bookings at approximately £6.2m and a robust pipeline exceeding £4m. With our sights set on achieving an EBITDA positive run rate entering the second half of the year and positive operating cashflow in the current financial year, I am very excited about the future prospects of Silverbullet. Our unwavering confidence in the Group’s trajectory is grounded in our steadfast commitment to innovation, client satisfaction, and sustained growth.”
Annual Report
The Annual Report for the year ended 31 December 2023 will be available to shareholders and investors on the Company’s website from Friday 31st May 2024 at: https://investors.wearesilverbullet.com/investors/financial-reports.
CHAIRMAN’S STATEMENT
It is my pleasure to present the annual results of Silverbullet Data Services Group Group PLC (“Silverbullet”, the “Company” or, together with its subsidiaries, the “Group”). I am very pleased with the development made in in 2023, yet again delivering impressive revenue growth but also significantly reducing our cost base. I am delighted with how the management team have grown the business and the tightly controlled costs in what remained a challenging global economic environment in 2023.
4D, our AI contextual data platform that sits within our CX Product Studio is showing true maturity and it is starting to generate the interest and activity that we anticipated when we decided to launch the product. Equally, our strategic managed services within our CX Solutions Suite continue to grow and develop delivery first-class results and service to significant blue chip client base.
Results
Revenue for the year was £8.36m (2022: £5.82m), driven primarily by growth in our data-driven transformation services business, providing data consultancy advice to numerous clients across the world. Loss before tax was £3.45m (2022: £7.54m) leading to a loss per share of 20p (2022: 49p). Cash as at 31 December 2023 was £0.68m (2022: £1.35m).
People.
I have the honour of leading an excellent Board of Directors for the Group.
With respect to our non-executive directors, Steven Clarke and Martyn Rattle both provide a raft of industry insights and experience, as well as relevant governance experience. Following the Keith Sadler’s departure as an Non-Executive Director in 2023, AnnaMaria Khan-Rubalcaba joined the Board as an Independent NED in April 2024 (post period end). AnnaMaria brings further industry experience to the board, having served as Chief Executive of HYD, an Omnicom Group Digital Product Agency, for over five years. AnnaMaria has joined Steven Clarke on the audit and remuneration committee and will focus on Board governance in the privacy first era and on the adoption of AI into our own and client’s organisations.
During 2023, our three executive directors, Ian James, Chief Executive Officer, Umberto Torrielli, Chief Strategy Officer and Darren Poynton, Chief Financial Officer showed true focus and commitment in leading the Group and driving growth and successfully executing the agreed strategy of business. On 9th April 2024, we announced that Darren Poynton would be stepping down as Group CFO and Company Secretary to move to a new role and opportunity. Darren has been an integral part of the business for the past five years, playing a crucial role in driving business growth. Under his financial leadership, the Group successfully navigated an IPO in June 2021 and maintained a trajectory of strong financial performance. I would like to thank Darren for his significant contribution and commitment to the Company.
On the 8th April 2024 we were delighted to announce that Chris Ellis joined the Group as Group CFO and Company Secretary. Chris Ellis is a qualified chartered accountant and an accomplished, target-driven senior executive with extensive experience gained from leading complex global private equity and publicly owned businesses. I would like to welcome Chris to the board at this exciting time for the Group.
I would like to thank all our employees across the world for their dedication, expertise, and commitment to generating significant growth and delivering excellent work for all of our clients.
Overview.
In an environment where global clients are seeking innovative solutions to data driven customer experience challenges, I believe Silverbullet is perfectly placed to deliver truly bespoke and agile solutions. The success that the Group has achieved to date and the significant historic investment in product, people and processes put the Company in an ideal position to continue to be successful and grow in the future. The Board will continue to work with the executive and management teams in 2024 to develop and deliver on the strategy and to create value for our shareholders.
Nigel Sharrocks
Non-Executive Chairman
28th May 2024
CEO STATEMENT
I am delighted to report our Annual Accounts for 2023. Our full year results show strong, sustained growth on the backdrop of a once in a generation shift to data and AI driven marketing transformation. The demise of a generation-old AdTech ecosystem which is based on non-compliant data sources (such as the third-party cookies), is being rapidly replaced by a first-party data driven, privacy-first marketing environment.
98 per cent. of marketers report they’re concerned about the disappearance of the third-party cookie, as traditional ways of working are no longer fit for purpose. We have reached an inflection point in the industry where first-party data marketing methods, accelerated by AI, are radically transforming marketing insights targeting, measurement, and organisational efficiencies.
This transformation requires clients and their agencies to seek new solutions driven by a combination of innovative new enterprise MarTech and AdTech platforms, and the guidance and support of specialist human expertise, to lead them through the data integrations and engineering required to evolve their organisational set-up to remain competitive.
Silverbullet has continually evolved its offering to meet this global client demand for bespoke solutions rather than individual data products. By combining the proprietary data platforms of 4D AI and Silverbullet Cloud with specialist skillsets in data strategy, technology implementation, and data integration; Silverbullet provides a one-stop shop for data driven marketing transformation and is trusted by some of the world’s biggest brands.
With its unique blend of products and services, Silverbullet is perfectly positioned to deliver this transformation, at global scale. 4D AI has grown significantly in the last 12 months, with the final demise of the third-party cookie and a continued tightening of global data regulations presenting a perfect backdrop to unlock new value for our global client base.
Business Growth:
As more global clients shift towards adopting transformational strategies to adapt to the new marketing era, Silverbullet continues to grow. We have witnessed a rise in the employment of customer-experience led infrastructures with the core goal of unlocking data to improve marketing ROI and the overall customer experience.
Furthermore, as more businesses seek cookieless, privacy-first and brand-safe solutions to solve for the new digital advertising era, contextual insights and targeting continues to rise in importance. The Company’s proprietary product, 4D AI, is positioned perfectly to support leading brands with scaled AI accelerated post-cookie digital advertising.
Total Group revenue increased by 44% to £8.36m (FY22: £5.82m) and revenue from 4D increased by 85% to £2.81m (FY22: £1.52m), with US and Global clients now accounting for more than 50% of total Group revenue. This growth can be attributed to the expanding number of global brands adopting 4D and other AI-driven marketing models to structure customer data in a way that improves direct customer experience and marketing ROI.
Silverbullet has strategically consolidated key global client relationships such as Mars and Heineken to position itself for accelerated growth and scalable cross-pollination of 4D AI in 2024. Clients worked with during the year include, Disney, Progressive, Thomson Reuters, Aramco, Heineken, ITV and Mars.
As a result of the significant increase in revenues and a reduced cost base, Silverbullet has significantly reduced losses for the year ended 31 December 2023, compared to the prior year.
4D Highlights:
4D AI is now available for brands and agencies to use in a variety of ways, from “self-service” and private data marketplaces for sophisticated media agencies, to a full managed service for those brands who would prefer to outsource the execution of full insights, targeting and measurement of campaigns.
Since inception, a key strategy for 4D AI is to embed its proprietary data and technology into partner platforms who have established market scale and client demand. In 2023, the Company successfully achieved several 4D AI technology integrations, including a leading contract with OpenX Technologies, Inc., and PubMatic, Inc., two of the world’s leading independent supply-side platforms (SSPs) for audience, data and identity led digital advertising targeting.
In line with the final deprecation of the third-party cookie in the near future, Open X has recently launched its Cookieless Deal Library, allowing advertisers to easily test and scale campaigns against the full universe of cookieless targeting options and activate in their Demand-Side Platform (DSP) of choice. Contextual Deals in the Open X Cookieless Deal Library will be powered by 4D AI.
These integrations have enhanced the technological capabilities of 4D AI, expanding its recurring revenue generating distribution. This in turn has set the foundations for continued partnership deals and 4D AI platform development moving forwards in line with market demand.
Geographical and Network Expansion:
During 2023, the Company successfully delivered on its goal to expand the business in the US and Latin America, predominantly driven by the expansion key global client relationships and the US growth of 4D. During FY23 we successfully launched a client delivery hub in Mexico City. The team of data specialists in Mexico City will enable continued growth in the US and LATAM in a cost-efficient scalable way.
The Company’s strong enterprise technology partner relationships continue to grow, with key partners Salesforce and Treasure Data. In fact, the 2024 Gartner® Magic Quadrant™ for Customer Data Platforms sees Treasure Data recognized as a Leader within the MarTech ecosystem. Silverbullet has been certified with Gold Partnership status with Treasure Data, and has also seen further recognition with Salesforce, being awarded the Salesforce ANZ Innovation & Impact Partner of the Year in 2023.
Information security management
During the year, the Company successfully achieved ISO 27001 certification. This ensures that the Company’s information security management system and information security controls have been thoroughly reviewed and updated to the latest requirements and expectations. This ensures that the Company’s information security needs are met and closely monitored on an ongoing basis.
Outlook.
The business is perfectly aligned to the market’s need for first-party data and privacy-first future.
In January 2024, Google announced the launch of its third-party cookie deprecation initiative to be completed in Q1 FY25. Meanwhile, Apple continues to tighten their regulation on the use of individuals data in their ecosystem, setting a high bar of consumer privacy expectation for the industry at large to meet. These radical changes in privacy regulation and approach accelerates the importance of alternative privacy-safe insight and targeting tools such as 4D AI and a brands first-party data enablement, making Silverbullet’s position in the market stronger than ever.
This backdrop ultimately requires brands to transform their customer experience. 4D AI combined with first-party data transformation demand is already accelerating, with a strong start to 2024 in terms of committed revenue with has bookings of over £6.2m.
Clients are increasingly expecting their partners to offer more customised approaches to meet their specific business transformation needs. Silverbullet is well placed to adapt its proprietary products, partnerships, and core human capital to evolve data solutions which meet its clients needs whilst maintaining a solid business model through an increase in the adoption of AI to enable organisational efficiency for repeatable tasks, ultimately reducing cost base and improving margins.
The business continues to manage its cost base tightly whilst investing in talent to secure and deliver outstanding work to our clients. This, together with the increase in revenues, allows the business to continue to move towards a position of profitability.
Ian James,
CEO, Silver Bullet Data Services Group
28th May 2024
