Ebiquity PLC, a leader in media investment analysis, has released a trading update for the first half year ended 30 June 2024. The company anticipates an unusually strong weighting to the second half of the financial year. For the half year ended 30 June 2024, Group revenue is expected to have declined by 7% to £37.9 million, primarily due to some large clients continuing to reduce budgets. The Group's cost base is largely fixed, and in light of reduced revenues, Adjusted EBIT for H1 2024 is expected to decline by 61% to £2.3 million, compressing Adjusted EBIT margin to c6%.
The company has undertaken a transformation program, which has enabled the development of a substantial weighted pipeline with contractual coverage for over 80% of forecast revenues for FY 2024. Revenues are expected to increase sharply during late Q3 and into Q4 with an associated material uplift in margins, leading to an expected recovery in overall margin for the full year. The net debt as at 30 June 2024 was £15.3 million with cash balances of £6.7 million and undrawn bank facilities of £8 million. The Board expects to generate significant profits in H2 2024 and has ample liquidity and headroom against its banking covenants.
The Board's expectations for a strong performance in the second half are underpinned by contractual visibility and the Group's existing pipeline. However, the Board believes profits for the full year will be below its previous expectations due to the material level of execution risk associated with delivering a steep ramp up in new business and renewals during H2 2024 and the weakness of the Group's performance in H1 2024. The CEO, Nick Waters, commented, "H1 2024 performance has been challenging, however the business has worked during this period to develop a deep pipeline of revenue opportunities which are scheduled to be closed and delivered in H2."
The company will issue its interim results on 26 September 2024 and will provide further guidance on the expected full-year outturn.