NetDimensions (Holdings) Limited: Final Results for the Year Ended 31 December 2014

HONG KONG, CHINA--(Marketwired - Apr 13, 2015) - NetDimensions (Holdings) Limited (AIM: NETD) (OTCQX: NETDY)

OTCQX: NETDY

13 April 2015
NetDimensions (Holdings) Limited
("NetDimensions" or the "Company" or the "Group")

Final Results for the Year Ended 31 December 2014

NetDimensions (AIM: NETD; OTCQX: NETDY), a global provider of performance, knowledge, and learning management systems, is pleased to announce its final results for the year ended 31 December 2014.

Highlights

• 40% revenue growth to a record high of US$22.7M (2013: US$16.2M)
• Invoiced sales from new business up 102% to US$10.1M (2013: US$5M)
• 42% increase in the number of active users to 4.4M (2013: 3.1M)

Roger Durn, Chairman of NetDimensions, commented: "The financial results for the year ending 31 December 2014 saw an acceleration in the growth of sales revenue with a 40% increase over the prior year, ahead of both analyst expectations and the 17% growth rate reported in 2013. This acceleration in the rate of revenue growth provides the Board with confidence that the Company's strategy of focusing on high consequence industries is beginning to deliver results."

The annual report will be available on the Company's website and sent to shareholders shortly.

About NetDimensions

Established in 1999, NetDimensions (AIM: NETD; OTCQX: NETDY) is a global provider of performance, knowledge and learning management solutions.

NetDimensions provides companies, government agencies and other organizations with talent management solutions to personalize learning, share knowledge, enhance performance, foster collaboration and manage compliance programs for employees, customers, partners and suppliers.

Recognized as one of the talent management industry's top-rated technology suppliers, NetDimensions has been chosen by leading organizations worldwide including ING, Cathay Pacific, Chicago Police Department, Geely Automotive, Fugro Group and Fresenius Medical Care.

NetDimensions is ISO 9001 certified and NetDimensions hosted services are ISO 27001 certified.

For more information, visit www.NetDimensions.com or follow @netdimensions on Twitter.

Chairman's Statement for the Year Ended 31 December 2014

I am pleased to report that the Company has made excellent progress in the year achieving a record high for reported revenue, which increased by 40% to US$22.7M (2013: US$16.2M). The 2014 financial year is the first full reporting period since the implementation of the multi-year business plan in May 2013 to substantially grow sales revenues with a focus on high consequence industries (heavily compliant and highly regulated industries) and the results for the year provide the Board with confidence that the Company is delivering on the business plan.

Highlights

• 40% revenue growth to US$22.7M (2013: US$16.2M)
• Invoiced sales from new business up 102% to US$10.1M (2013: US$5M)
• 42% increase in the number of active users to 4.4M (2013: 3.1M)

Financial Summary

The financial results for the year ending 31 December 2014 saw an acceleration in the growth of sales revenue with a 40% increase over the prior year which compares favorably to the growth rate reported in 2013 of 17%. This acceleration in the rate of revenue growth provides the Board with confidence that the Company's strategy of focusing on high consequence industries is beginning to deliver results.

The Group continues to improve direct sales activity and, in the period, the proportion from direct clients was US$20.3M representing 85% (2013: US$14.1M, 80%) of total invoiced sales. Increasing focus on direct sales in high consequence industries has led us into bigger deals with the average first year deal size for new direct clients hitting US$106K in the year (2013: US$101K). Invoiced sales to clients in high consequence industries represented 78% of total invoiced sales, an increase of 42% over the prior year, providing a further indication that we are delivering on the business plan.

The EMEA region maintained its position as the largest market for the Group comprising 47% of Group revenues. The North America region accounted for 41% of Group revenues and Asia Pacific including China 8%. The rest of the world made up 4%.

The Group saw substantial growth in the EMEA market with revenues up 49% to US$10.6M (2013: US$7.1M) on the back of a number of new client wins in high consequence industries, particularly in the manufacturing sector. In addition, the Group ended the year with a strong deferred revenue balance of US$8.6M (2013: US$7.6M), some 13% higher than the prior year balance.

The Group continues to focus on supplying software via its global hosted secure SaaS service and we are pleased to report that revenues from this product offering increased by 36% to US$8.3M (2013: US$6.1M). Recurring revenues under contract totaled US$19M at the end of the year of which US$12M will be recognised as revenue in 2015. This combined with deferred revenue of US$8.6M provides the Group with an excellent start to 2015.

The Group's adjusted loss before tax, excluding net foreign exchange losses (US$0.3M), intangible asset amortisation (US$0.5M) and non-cash share-based payments (US$0.7M), was US$3.5M (2013: loss of US$4.0M). NetDimensions' loss before tax was US$5.0M (2013: US$4.9M).

Cash used in operating activities was US$2.1M in the year (2013: US$2.5M). The Group's cash balance at the end of the year was US$4.9M (2013: US$7.7M) and the accounts receivable balance was US$7.5M (2013: US$6.6M).

I am pleased to announce that the Board recommends an increase of 4% in the final dividend to GBP0.625 pence (or US$0.9 cents) to be paid from the share premium account. If approved, the dividend will be paid on 24 July 2015, with an ex-dividend date of 25 June 2015 to shareholders on the register with an associated record date of 26 June 2015.

Notice of AGM

The Company's AGM will be held on Monday 15 June 2015 at 12:30pm on the 18th floor, Siu On Centre, 188 Lockhart Road, Hong Kong.

Income tax provision of US$0.1M (2013: nil) was made in the year.

Operations Review

The 2014 financial year was the first full reporting period since the Board commenced the implementation of the multi-year business plan to substantially increase market share, targeting clients operating in high consequence industries and I am pleased to report on the following progress:

• Positioned again as a 'Core Leader' in the 2014 release of the European learning and talent market insight report, Elearnity 9-Grid™ for Learning Management Systems (LMS)
• Invoiced sales to clients in high-consequence industries represented 78% (2013: 76%) of total invoiced sales for the year
• Re-organisation and expansion of the Global Services Division
• 66 new clients added in the year through direct and reseller channels with a combined contracted value of US$4.6M. These new clients include Chase Bank Kenya Limited, Credit Corp Group Limited, Community Memorial Health System, PeaceHealth, University of Kansas Hospital, UAP Insurance, Dubai Air Wing, SEW-EURO Drive GmbH & Co KG, and IDEXX Europe B.V. These new clients operate in a number of high consequence industries including healthcare, financial services, aviation, transportation, telecommunications, and life sciences

Outlook

The Company made substantial progress in 2014 in terms of revenue growth and delivering on the strategy of focusing on high consequence industries. The Company will continue to build on the progress made in 2014 and believes there is an excellent market opportunity in focusing on high consequence industries within the Talent Management space.

Finally, we would like to thank all of the people who work at NetDimensions for their hard work, loyalty and dedication in 2014.

We look forward to another successful year with them, along with our clients, partners and shareholders in 2015.

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