Silver Bullet Data Services Group plc (LON:SBDS), Silverbullet, a provider of AI driven digital transformation services and products, is pleased to announce interim results for the six months to 30 June 2024.
Cash generated from operations, current record bookings and committed revenue, on target to achieve an EBITDA positive run rate from October onwards.
Financial Highlights
| Six months to June 2024 | Six months to June 2023 | |
| Revenue | £4.4m | £4.2m |
| Gross Profit | £3.3m | £3.3m |
| EBITDA* | (£0.9m) | (£1.2m) |
| Reported Loss before tax | (£1.6m) | (£1.8m) |
| Earnings Per Share | -0.08p | -0.10p |
*See note 3 of notes to the interim accounts
Highlights
· Confident of achieving an EBITDA positive run rate from October onwards
· Continued strong revenue growth over 2023, excluding one-time discontinued business
· Repeatable services business up 32% for H1 24 versus H1 23
· 4D AI revenues up 17% for H1 24 versus H1 23
· 4D AI integrations into other platforms expected to drive further strong growth in H2 24
· Global and US Client revenues increased to 57% versus 47% in H1 23
· Cash generated from operations of £0.2m in H1 24 (-£1.3m H1 23)
· Narrowing EBITDA loss
· Total bookings and committed revenues as of 31 August 2024 are £8.6m (versus £7.1m in the period to 31 August 2023, 21% increase) year-on-year being greater than last year’s full-year revenue of £8.3m
Ian James, Silver Bullet Data Services Group Chief Executive, commented:
“We are delighted with the continued progress and positioning of the Company, as well as our strong revenue growth entering the second half of the year. With the objective of achieving a consistent positive EBITDA run rate, the Board took the decision in the first half to focus on higher margin long-term repeatable business and decided to discontinue previous lower margin projects. The second half of the year started particularly strongly with new global contracts and, as a result, we have strong visibility on full-year revenues, having already surpassed the total revenue for FY23 by the end of August FY24. At the same time, we continue to carefully manage our investments in talent and operational costs.
“With the Company reporting a positive cash flow position in the first half of FY24 and confident of achieving an EBITDA positive run rate from October onwards, the Board remains particularly optimistic about the future of the business.“
Chief Executive Officer’s Report
Silverbullet is pleased to announce a positive performance for the first half of 2024, meeting management’s expectations for the period combined with a particularly strong start to the second half. Alongside revenue growth, the Company has achieved key milestones, including reaching positive operating cash flow in the first half and total bookings of £8.6 million by the end of August which already surpasses the total revenue recorded for the entire FY23 whilst maintaining a consistent cost base.
The Company’s growth and key milestones demonstrate its focus on building long-term, repeatable business, particularly with global and US clients. Notably, revenue contributions from these regions increased to 57%, compared to 47% during the same period in FY23. This strategy is driving robust growth by expanding the scope of work with existing clients and securing over 20 new scalable, long-term client engagements in the first half of the year.
During this period, the Company achieved overall revenue growth of 5.1% compared to H1 2023, reaching £4.4 million. With a focus on achieving a positive EBITDA run rate, the Board took the decision to focus on higher margin long-term repeatable business and decided to discontinue previous lower margin projects. As a result, after discontinuing several one-off clients from the previous year, who were not deemed repeatable, the Company saw a like-for-like growth of 32% in its CX services business and 17% in its 4D AI division, compared to the first half of FY23. This success stems from deepening engagements with both new and existing clients across its three key markets: the US, UK, and APAC, as companies accelerate their data-driven marketing transformations.
In February, the Company announced an extended contract with Mars Petcare US (“Mars”), which provides pet nutrition, health, and veterinary services as part of Mars, Incorporated. Silverbullet extended its partnership with Mars for the third consecutive year, from January to December 2024. In this extended collaboration, the Company will be broadening its support to Mars across three primary workstreams, specifically dedicated to the implementation of AI driven first party customer data intelligence.
In March, Silverbullet announced new contract wins and renewals worth, in aggregate, £1.7 million. It secured a renewed contract with Heineken, a Global Dutch multinational brewing company with a presence in over 70 countries and ownership of 165 breweries. As Heineken’s trusted data services partner, Silverbullet will serve as a multi-regional resource for first-party data services, overseeing the implementation of a comprehensive first-party customer data strategy and implementation. In addition, Silverbullet successfully renewed its 2023 contract and secured a new contract with a leading pub retailer and brewer in the UK. Silverbullet is collaborating closely to deliver transformative solutions, leveraging AI and digital strategies to enhance their operations.
As customer data, enhanced by AI, becomes increasingly vital to businesses, Silverbullet is well-positioned as a leading Data-Driven Customer Experience (CX) company. Operating at the heart of the data ecosystem, Silverbullet enables clients like Heineken, Mars, Sony, and Omnicom to drive marketing transformation by unlocking the value of first-party customer data, marketing technology, and AI-powered advertising tools.
With growing consumer demand for data privacy, Silverbullet helps its clients communicate with their customers in a privacy-first manner, while maximising marketing ROI through optimised use of data and marketing technology.
The business is comprised of two divisions:
Customer Experience (CX) Services Suite
Strategic Consultancy & Managed Services
· Our strategic consultants combine key digital capabilities with industry expertise, bridging the gap between marketing data and technology in complex client environments.
Customer Experience (CX) Product Studio
4D AI & Silverbullet Cloud
· Rooted in privacy and driven by powerful AI and the industry’s most robust data, the Silverbullet Cloud is made up of a portfolio of owned and operated data tools and platforms which empower global brands to personalize every single customer journey, driving better ROI for digital marketing spend.
CX Services:
Silverbullet’s Customer Experience (CX) Services division achieved impressive growth of 32% (excluding discontinued one-off clients) during the period, with revenues increasing to £2.9 million. This growth was driven by securing additional contracts, expanding the scope of work with existing global and US clients, and winning 20 new clients. Notably, multi-brand international clients like Heineken, Mars, and Omnicom Group continue to adopt more services from Silverbullet, benefiting from the Group’s expanding service offerings, product suite, and growing geographical footprint.
Compared to the same period last year, the Company’s top three clients experienced revenue growth of 19%, 41%, and 60%, respectively. Additionally, Silverbullet secured a major contract with a global confectionery company, granting the company a worldwide mandate to lead its data transformation strategy.
Silverbullet’s partnerships with global enterprise marketing software companies such as Salesforce, Treasure Data, and Braze continue to thrive. These partnerships enable clients to build long-term, transformational data infrastructures that can be systematically replicated with the support of Silverbullet’s CX services and Cloud data products across new geographical markets and brands. This expansion, in turn, provides Silverbullet with a robust pipeline and significant opportunities to further grow services with both new and existing clients.
4D, AI Contextual Data Platform and Silverbullet Cloud
4D, Silverbullet’s AI contextual data targeting and insights platform, has delivered continued growth in the period, with revenues growing by 17% versus H1 2023 to £1.5m, with bookings by the end of August exceeding the total revenue booked in whole of FY 23. This has been driven by a combination of the managed service offering in the US market, and the increasing recurring revenue generated by 4D integrations in partner technology platforms. These 4D data revenues from partner integrations increased 33% year on year and have established a strong platform for scaling in second half of the year and into FY25. During the period the company secured seven data integrations with scaled partners in the digital advertising space.
Multiple clients regularly used the platform in the period, including Coca Cola, Marriott, Disney, Sunkist and Burger King providing a solid foundation for growth moving forward.
Board Changes
In April, Chris Ellis joined Silverbullet 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. His industry expertise spans Financial Services, Healthcare, Technology/SAAS, and Oil & Gas sectors, ranging from enterprises with turnover exceeding $1.5 billion and 2,500 employees to smaller businesses with turnovers less than $100 million and 50 employees.
AnnaMaria Khan-Rubalcaba was also appointed as a new Non-Executive Director, who brings extensive senior-level experience in marketing technology and AI services. AnnaMaria serves as Chief Executive of HYD, an Omnicom Group Digital Product Agency, for over five years, from January 2019 to the present. Prior to her role as Chief Executive, she held the position of Managing Director, where she contributed to the operational and managerial aspects of the agency. Her insights have already proved invaluable to Silverbullet’s progress in AI and further development of its 4D data platform.
Outlook
We are pleased with the continued progress and positioning of the Company, as well as our strong revenue growth, driven by a focus on long-term, repeatable engagements with global and US clients. As privacy regulations tighten, with 75%1 of the world’s population now covered by privacy-first legislation, we are seeing increasing global demand for Silverbullet’s data products and CX services.
The Company remains committed to delivering world-class value to both current and new clients through data-driven business transformation. We will also continue to expand our integrations with partner technology platforms and grow the licensing of our 4D AI data offering. In August, we secured a significant contract for 4D AI integration with one of the world’s largest programmatic self-service advertising platforms, which handles US$9.6 billion in annual transactions.
We have strong visibility on full-year revenues, having already surpassed the total revenue for FY23 by the end of August FY24. At the same time, we continue to carefully manage our investments in talent and operational costs.
With the Company reporting a positive cash flow position in the first half of FY24 and confident of achieving an EBITDA positive run rate from October onwards, the Board remains optimistic about the future of the business.
Source: 1) IAPP Global Privacy Laws Analysis
