Broadcast and media technology software provider Pebble Beach Systems reported a 12% year-on-year increase in orders in its half-year report on Wednesday, reaching £4.9 million, up from £4.4 million in the first six months of 2023.
The AIM (Alternative Investment Market)-traded company said that while total revenue for the period fell slightly to £5.3 million from £5.5 million a year earlier, it saw significant growth in higher margin service level agreement (SLA) revenue, which rose 21% to £3.1 million.
It said the shift towards recurring revenue, which now accounts for 58% of total revenue, helped maintain adjusted EBITDA of £1.4 million, in line with the first half of 2023 but with an improved margin of 27%.
Profit before tax increased to £0.3 million (compared to £0.2 million in the same period last year) and underlying earnings per share increased from 0.2 pence to 0.3 pence.
Operational highlights included the launch of the new IP-native PRIMA platform at the NAB show in Las Vegas and the strategic strengthening of the sales team, including the appointment of Sally Wallington as Senior Vice President of Sales.
In addition, the company continued to adjust SLA pricing, resulting in an increase in multi-year renewal orders.
Looking ahead, Pebble Beach reported a heavily weighted pipeline valued at £9.8 million – an increase of 13% year-on-year.
The company expects to meet market expectations for 2024 and will be able to deliver project orders quickly in the second half of the year due to shorter hardware lead times and improved operational readiness.
It was added that increasing multi-year SLAs also provides better visibility into future revenue.
“The Group continues to demonstrate its resilience with increasing order intake, although ongoing difficult external market conditions mean customers continue to delay decisions on upgrades,” said non-executive chairman John Varney.
“The Group entered the second half of the year with a strong distribution network and improved visibility – and higher value – of recurring revenues.
“The Management Board believes that we will meet market expectations for the current year and expects that more project orders will be awarded in the second half of the year due to historical trends and a strong order backlog.”
Varney said that given the continued momentum seen within the Group, the Board is focused on driving further organic growth and, where necessary, supplementing this with inorganic growth as opportunities to improve technology are identified.
“We continue to invest in developing our new solutions to support the industry in its transition to intellectual property and I am confident that PRIMA will be the best product to support the inevitable widespread adoption.”
At 12:41 BST, Pebble Beach Systems Group shares rose 4.57% to 12.02 pence.
Reporting by Josh White for Sharecast.com.
