PARIS, Aug. 30, 2012 /PRNewswire/ -- Hubwoo (Euronext: HBW.NX), a leading global provider of B2B buying and selling solutions in the cloud, today announced audited financial information for H1 2012, in accordance with the "European Transparency Obligations Directive" financial disclosure requirements.
Greg Mark, Hubwoo CEO, commented: "On July 31st we announced H1 2012 revenue of EUR 17.4M. We today confirm an EBITDA profitability level of EUR 1.3M, down slightly from 2011 due to one time costs and investments. Hubwoo continues to invest aggressively in its Business Network and is thus innovating for future growth. The Business Network leverages today's powerful collaborative technology drivers of search, community, and ratings – on top of a proven transactional platform of enterprise class B2B commerce."
1. Financial data
variation in % (**) H1 2012 vs H1 2011
(*)EBITDA: Operating result before depreciation and non recurring items.
(**) Percentages are calculated on exact numbers, not the rounded numbers shown
Accounts for 1st Half 2012 have been reviewed by the auditors and have been approved by the Hubwoo Board of Directors on August 29th 2012.
H1 2012 revenue was EUR 17.4 million, slightly lower (-2%) than H1 2011.
The EBITDA line, at EUR 1.3 million, is down compared to H1 2011 (-36%). While personnel costs remained substantially unchanged compared to 2011, external operational costs increased due to subcontracting on key implementation projects and increased royalties costs. As a percentage of revenue, EBITDA this semester represented 8% of revenues, but the Company expects to improve this ratio in the second half of the year.
In line with expectations, the level of restructuring/exceptional costs was just above EUR 0.3 million, compared to EUR 0.8 million in H1 2011.
EBIT was -EUR 0.6 million, as compared to -EUR 0.2 million in H1 2011, and net Income was -EUR 0.9 million, broadly stable compared to H1 2011 (-EUR 0.8 million) as a consequence of favourable foreign exchange effects.
Free cash-flow was negative by EUR 1.3 million. This movement was largely influenced by an adverse working capital movement of -EUR 2.5 million, mainly caused by restructuring and exceptional cost cashed out in Q1 2012, which were accounted for and provisioned in the 2011 profit and loss account, and a delay in customer payments. Capital investment level was strong at EUR 1.1 million, mainly focused on investment in The Business Network. This investment is financed by the proceeds of the capital increase of Q1 this year that raised a net amount of EUR 4.9 million. The company has significantly slowed hardware investment, as the rationalization effort of its hosting facilities is now largely complete.
The cash position at close of the semester is EUR 7.4 million, up from an opening level of EUR 5.5 million.
Major H1 2012 events
New Buyer Contracts and sales activity
In February Hubwoo announced the signature of a ten year contract involving 54 university hospitals of France. At the end of a public tender managed by Uni.H.A, Hubwoo was chosen from among 4 competitors as the most complete, most flexible and best solution fit for this group of hospitals. The contract covers the full Hubwoo suite including The Business Network delivered via the cloud. This new contract is effective in Q1 2013 and will influence revenues starting 2013.
Citgo and Cemex, joined The Business Network along with Consol Energy adding the Match & Approve modules. Other new contracts in the semester included Arkema, Pacific Rubiales, and Takeda along with large customers such as Electricité de France confirming renewal of long term business relationships with Hubwoo.
Overall, and in spite of the general economic slowdown, the sales pipeline has steadily improved over the last few months. This will translate in improved levels of activity in the second half of the year.
In February Hubwoo announced the launch of a capital increase. The subscription process for the capital increase took place between the 27th of February and the 16th of March 2012 and resulted in a total demand of approximately EUR 6.3 million which corresponds to a subscription rate of 138%. This over subscription allowed the increase to be extended to the maximum allowed of EUR 5.3M.
The purpose of the capital increase was to invest in business growth in the following areas:
Extend the Hubwoo solution suite, with specific focus on derivative revenue offerings within the company's business-to-business collaboration platform, The Business Network.
Accelerate top line revenue growth with further investment in sales and marketing.
The listing of these 26,255,778 new shares, issued at 20 cents each, took place on March 30th 2012. The new shares were added to the existing company shares under the same ISIN code (FR0004052561). After the new listing, Hubwoo's capital consists of 128,995,782 shares.
SAP BPO agreement renewal
In Q2, Hubwoo announced the extension of its global business process outsourcing (BPO) agreement with SAP AG. The extension underscores the customer success to date resulting from the existing agreement and provides a framework to further continue innovation for existing customers and cooperation on joint go-to-market activities. The agreement is now extended for an incremental minimum of three years beyond the five year term of the initial agreement.
New Product Releases
The Business Network leverages three of the most pervasive technology drivers of the 21st century – community, search, and ratings – on top of a leading platform of enterprise-class B2B commerce. During the quarter, Hubwoo released significant functional enhancements to The Business Network.
Invoice & Payment Status – Network offering that eliminates invoice & payment status inquiries to Accounts Payable by bringing all of an enterprise's status information to the cloud.
Supplier Master Synchronization – New functionality in Hubwoo's Master Data Exchange integration framework that reduces data administration and increases accuracy. The new offering synchronizes suppliers' self-administered data between the Network and back-office systems.
The Business Network Growth
The Business Network community of businesses surpassed the 300,000 threshold of participants. Increases in invoice presentment suppliers, sourcing suppliers, and P2P transacting suppliers accounted for the change. Community critical mass increases value for both buyer and seller customers, and also provides a basis for planned derivative network revenues.
Hubwoo is a leading global provider of B2B buying and selling solutions in the cloud. The Company manages a Business Network with over 300,000 active businesses and over 100 major international corporations as buyer customers of which 50+ are in the Global 1000. Significant customers include Honeywell, Shell, Evonik, EDF, Nokia, Monsanto, Michelin, Henkel, Statoil, The Hershey Company, CONSOL Energy, EcoPetrol, Carl Zeiss, Burton's Foods, and The Dow Chemical Company. Hubwoo has major operations in France, multiple U.S. centers, Germany, the U.K., Philippines, Belgium, and Eastern Europe.Listed in Compartment C on the Euronext Paris Eurolist. ISIN: FR0004052561, Euronext: HBW, Reuters: HBWO.PA, Bloomberg: HBW:FP