Trading Update and New Loan Facility

8 February 2016, ServicePower (AIM: SVR), a market leader in field management software, provides an update on trading for the year ended 31 December 2015.

Revenue for the year ended 31 December 2015 is expected to be up by 2.4 per cent at approximately £13.0 million (2014: £12.7 million). Gross profit is expected to be £6.0 million (2014: £6.0 million). Loss after tax is expected to be £1.1 million (2014: £0.9 million) with LBITDA of £0.4 million (2014: LBITDA £0.5 million).

Product related revenue is £8.1 million (2014: £7.3 million) up by 12% YOY with a gross margin of 65%. Professional and Managed service revenue is £4.9 million (2014: £5.5 million) down by 12% YOY with a gross margin of 17%. The decline in services revenue is due to a delay in professional services implementations in 2015 carrying forward into 2016 and the expiration of a low margin contract.

The Company will be announcing its results for the year ended 31 December 2015 on 6th April 2016.

Loan Facility

The Company also announces that it has obtained an unsecured short term loan facility for £1,000,000 from Herald Investment Trust plc, to take effect from 8 February 2016 and repayable in full on the 16 December 2016, accruing interest at a rate of 8 per cent per annum (the “Loan”). The purpose of this Loan is for on-going working capital purposes and in order to continue R&D investment.

Herald is a related party of the Company as it holds more than 10 per cent of the issued share capital of the Company and is therefore a substantial shareholder for the purposes of the AIM Rules. As a result, implementation of the Loan will constitute a related party transaction for the purposes of the AIM Rules. The directors of ServicePower, having consulted with FinnCap, the Company's nominated adviser, consider that the terms of the Loan are fair and reasonable in so far as the Company's shareholders are concerned.

Outlook

ServicePower continues to see momentum in sales and marketing execution, product innovation and industry recognition, having signed 16 contracts across our entire product suite since the start of July 2015, four of which were in January. This has been a good start to 2016 and the Company believes it has a strong pipeline, being driven by strategic marketing initiatives, the strengthening of the sales team, as well as a growing partner ecosystem, which will position ServicePower well for 2016. 

Marne Martin, CEO of Service Power plc, commented: “ServicePower continues to see momentum in sales and marketing execution, product innovation, and expansion of our partner ecosystem. Enhanced global contract activity, new white labelled products like NEXUS FS^TM and Optimization on Demand^TM which expand our sales pipeline through offering end-to-end, cloud based field service management software, as well as optimization as a service, and continuous enhancement to our industry acknowledged workforce management platform, position ServicePower well for 2016.

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About ServicePower

ServicePower is the only company that can provide a complete, global field management platform that controls all elements of the service lifecycle from offering an appointment, assigning resource and dispatching work through to tracking resources, processing claims and providing business intelligence and analytical reports. With advanced intelligence-based scheduling, dispatch and open market auction software, as well as access to a global network of 86,000 repair and installation technicians, we enable companies to control and schedule work using a mixed resource pool of employees and independent contractors. ServicePower provides solutions that cross all industries. Current customers include Assurant Solutions, Mitsubishi, Farmers Insurance, and Pitney Bowes.

ServicePower is listed on the AIM market of the London Stock Exchange with the ticker SVR.L. For more information please visit www.servicepower.com

Contract momentum

Contracts executed in late 2015 and to date in 2016 span globally and across a variety of industries including manufacturing, heating systems, furniture, communications and security include: 

• Leading UK specialist electrical importer and distributor utilising ServicePower’s repair network management, help desk and call centre services, as well as ServiceOperations
• Retailer and self-servicing dealer operating stores in the South Eastern United States extended its contract for ServiceScheduling
• New contract with a manufacturer for ServiceOperations, including expansion into additional territories
• extended engagement with a leading UK home appliances manufacturer for ServiceOperations;
• Global communication technology solution provider utilising ServiceOperations, ServiceStats and NEXUS FS^TM. The client also renewed ServiceScheduling to 2017.
• North American heating system manufacturer for ServiceOperations to support claim processing for its dealer network
• Tier one US warranty administrator of service contract administration for major US retailer and North American consumer products producer
• Distributor and manufacturer of building products extended agreement for services
• Leading security firm executed a contract for services in support of its US installation and repair business upgrading to the latest version of ServiceScheduling 

Partner Alliances

Recent partner additions include technology, resale and implementation partners, whom add complementary features, functionality or open sales channels, in terms of verticals or geographies. 2015 saw the addition of Concirrus, QTon Solutions, Semit IT, Jolt Consulting, Group Seven Consulting, Entercoms and PTC Thingworx.

ServicePower  selected Domo in January 2016 which offers a cloud based self-service business management platform, which further expands ServicePower’s business intelligence, big data and predictive intelligence capabilities, providing data and insights to customers, enabling them to make better informed operational decisions that will improve productivity and services, while also reducing costs.

Entercoms, is a leading Managed Services company in aftermarket services, powering aftermarket and the service supply chain through analytics, a proprietary control tower platform and operations expertise.  This solution will provide route optimization as well as parts optimization, through a seamless integration between scheduled field resources and the parts required to increase first time fix rates, and ultimately, customer satisfaction.

Product Innovation

The Company continues to focus on product innovation, with the launch of NEXUS FS^TM Field Management Software, Optimization on Demand^TM, four patent applications for Quantum Annealing, further enhancements to ServiceScheduling, ServiceMobility, ServiceOperations, ServiceStats and the new Management Console.  NEXUS FS^TM and Optimization on Demand^TM open up new sales channels both in the SME space as well as with our partner ecosystem which we’ve already seen demonstrated in 2016 with the first trial agreements for Optimization on Demand^TM and first SME users for NEXUS FS^TM.