Imaginatik breaks even

11/06/2008

Imaginatik, provider of problem-solving software, broke even in the second half of the year, cropping annual losses from £1 million to £131,000.

The London-based company, whose software enables companies to mine the ‘collective genius’ of their staff and customers, added nine new clients on annual licences and expanded relationships with Cargill, Solvay and Whirlpool. Furthermore, pharmaceuticals giant Pfizer invested a ‘strategic’ £500,000 during the year as well increasing its importance as a client by buying 10,000 software licences.

This helped revenues climb 27 per cent to £3.16 million for the year to March and delivered an operating profit of £340,000 in the second six months. Half of all revenues are now recurring and chief executive Mark Turrell said that the ‘continued acquisition of new annual fee-paying clients’ remains a primary aim.

The inventor of the technology and founder of the business, Turrell says after effecting a strategic refocus early last year from smaller to larger clients, the business is now ‘more efficient, better at selling and more scalable’. A reseller agreement negotiated with IBM last August has already resulted in ‘solid’ revenue generation in a variety of sectors, including with Wal-Mart, and the pair are now expanding their relationship into Europe and Asia.

In light of the results house broker WH Ireland has downgraded its forecasts for the current year from £5 million to £4.4 million sales (underpinned by annualised recurring revenues of £1.81 million) and pre-tax profit from £500,000 to £300,000 for the current year.

Capitalised at £6.57 million, Imaginatik’s shares have been volatile performers since listing at 7.5p in December 2006, sinking to 2.75p last November and up 10.5 per cent on these results to 5.25p.

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