Defenx PLC (LON:DFX) Chief Financial Officer Philipp Prince caught up with DirectorsTalk for an exclusive interview to discuss their latest interim results, the BV Tech master services agreement & their recent fundraise
Q1: You announced your interim results today, can you talk us through the highlights Philipp?
A1: Revenue level, we’ve announced 35% revenue growth which is continuing the good revenue growth that we’ve delivered since IPO, the underlying revenue growth is actually 45% and what we’re pleased about there is it’s both from volume and average revenue per user growth so both volume and price are going in the right direction.
Below the revenue, as we’ve said to the market before, it’s a story of two halves, we’re on line in the first half with revenue but the revenue growth all comes in the second half so the operating loss in the first half is as expected because the profits will come through in the second half of the year.
In terms of that second half of the year we’re seeing, from the market, massively exciting opportunities. All the recent cyber-attacks along with things like the EU General Data Protection Regulation coming in next year are massive drivers for investment, particularly in the corporate world and that’s where our strategic partnership with BV Tech is really coming to its own now.
Q2: You announced a master services agreement in relation to the development and assignment of software with BV Tech, can you tell us more about that?
A2: If I can just take a step back, in April Defenx announced the strategic partnership with BV Tech, to remind everybody they’re a large Italian systems integrator who have increasingly been focussing in cyber security. They invested in us, sold some of their software to us, finding us some software distribution contract and then today, we announced the software development structure.
So, we have all of the foundations in place with this large partner, 500-600 people who know how to sell and work and deliver to corporates so they are now ready to work with us to get into the corporate market much more quickly. The strategic reason for that is because the system previously focussed on retail side, we’re now adding the corporate market.
Under this master services agreement, we comply with the AIM rules by tendering everything but where they can demonstrate that they can offer the same or better service, time and price, they will as a preferred supplier get the work. We’re very pleased that we can therefore leverage their 550 off people who know how to deliver into the corporate market, it’s taken some time to get there but it’s now in place.
Q3: Defenx PLC successfully raised money recently; can you give us some details around the raise and what you plan to do with the proceeds?
A3: So, as investors have been following us will have seen, in August we did an equity placing along with a further subscription with BV Tech and also a €1.25 million convertible bond was issued so in total we raised €2.99 million, so just short of €3 million, net of expenses. That is primarily to support this work, amongst others, with BV Tech in entering the corporate market more quickly than we could otherwise do.
So, our product team are working with existing developers and BV Tech to look at exactly what needs to be done and added to our product portfolio. Essentially, that is, if you like, corporatizing our existing security software so it’s network version of antivirus and anti-malware and interestingly it’s things like encrypted cloud backup and that really address the market like GDPR needs as we go through the next 6-12 months.
So, it’s all very exciting and that’s what the funding is going to be used for over the next 12 months.
