Payment provider's revenue rose 20% thanks to a major $4m contract and impressive US growth
Companies: Eckoh plc
Shares in global payment provider Eckoh rose 7% on Monday after the AIM-listed firm told investors that its trading for the year was comfortably in line with expectations, with revenue up 20% for the fourth year in a row.
Eckoh said it made progress in the UK, but that its operations in the US have produced the record year in revenue and order book. Thanks to bumper sales and favourable forex rates post-Brexit, the US-derived revenues have grown as a proportion of total revenue.
Earnings and revenue visibility has improved, driven by growing US sales which are longer term Saas (Software-as-a-service / subscription based) commercial relationships.
The company also secured its largest ever contract worth nearly $4m during the year, and in total US payment contracts increased from $1.5m to $8.3m: "...with over 90% of this contract value derived from agreements using the preferred SaaS-style pricing model."
Broker N+1 Singer said Eckoh's trading update for the year was “comfortably” in-line with market expectations, with Net cash expected to be ahead of market expectations:
"The group continues to make good progress in the UK, and the US has produced a record year in terms of revenues and order book. The group recently announced its largest ever payment contract ($3.7m) win and total contract value of US wins 5x the size what was won in the previous year."
Singer's analyst Tintin Stormont said the firm's pipeline was robust, reiterating the belief that substantial growth opportunities were ahead for the Group and it was well placed to convert them.
Eckoh also announced that Non-Executive Chairman Chris Batterham was stepping down from his role at the upcoming AGM, stressing that the search for his replacement was already "well advanced".