9 April 2024

Cirata plc

("Cirata" or the "Company")

Q1 FY24 Trading Update

GTM and sales organization embedded for growth

Cirata plc (LSE: CRTA), announces a trading update for the quarter period ended March 31, 2024.  An accompanying video presentation and discussion can be found on the Cirata Investor Relations webpage here.

Summary

·    Bookings for the period of $0.7m

·    Steady build in pipeline

·    Sales and partner activity increased

·    Fifteen contracts signed, improved mix to "new and growth"

·    Important new business secured in re-invigorated DevOps offering

·    New releases of Live Data Migrator (LDM) and major release of DevOps (ALM)

·    Cash position at the end March was $13.3m

·    Management reconfirms FY24 bookings guidance of $13-15m (81%-108% YoY growth)

Trading update

Bookings in Q1 FY24 were $0.7m (Q1 FY23: $2.1m, which benefitted from a large renewal), with DevOps/Application Lifecycle management ("DevOps") software accounting for 51% of bookings and Data Integration ("DI") software accounting for 49% of bookings.

In total, fifteen contracts were signed in the quarter, nine of which were new and growth[1] contracts.  This included two new contracts in DevOps, secured with Onsemi and Marvell Technology. The new subscription contract with Onsemi in DevOps represents the first positive step in the reboot of the DevOps business. New DI contracts included deals signed with the Bank of Nova Scotia, Westpac Banking Corp and a large African financial services group. We also saw further growth at Tesco, a returning customer. Two deals secured in Q1 were greater than $150K in value: one in DI and the other in DevOps. 

Technology is core to Cirata and its market differentiation. Further progress was made in Q1 on shaping the product roadmap with direct customer input for LDM. In DevOps, we announced the availability of Gerrit 3.7, and we are already in discussions with customers on Proof of Concept.

As previously outlined, deal slippage remained a feature of Q1 performance. Some of the orders that were targeted for FY23 Q4 closed in early FY24 and, similarly, some of the deals targeted for Q1 have also slipped with the expectation that these will now conclude in Q2. Issues contributing to slippage include the complex nature of enterprise sales for data integration, protracted procurement processes and the ramping of the new sales team. Establishing greater sales cycle predictability, therefore, remains a key priority for management, to move beyond the current non-linear growth trajectory. To that end, Q1 saw the final changes made to the company's Sales organization.  With that complete, Management believes that the foundations are now, for the first time, in place to deliver steadily improving pipeline predictability and performance.

As previously reported, Management expects that bookings will be H2 weighted in FY24 as the pipeline builds and the Sales team becomes more proven. The FY24 bookings guidance, which Management reconfirms today, is based on an expectation of higher levels of sales activity, both direct and through partners, and on the current sales pipeline. The new GTM organization is bedding down and leads from partners and customer activity levels are increasing and contributing to pipeline growth.

A table of key performance indicators will be posted to the Investor Relations landing page Cirata KPI by 30 April 2024.

Stephen Kelly, Chief Executive Officer, commented.

"I want to provide a balanced scorecard and honest perspective on the progress of Cirata. We were disappointed by the actual Q1 bookings and again experienced deal slippage relating to the complex nature of enterprise sales, protracted procurement processes and the ongoing ramping of our new sales team. However, I am pleased with the increasing level of sales activity in the quarter, following the complete reboot of the GTM organization.

The cadence of customer interaction has ramped significantly, and we are seeing improved commercial re-engagement as evidenced by the range of logos we have contracted with in Q1. Signing our first new contract in DevOps for some years as well as securing new and returning logos in DI has been encouraging and energizing for our team. Innovation in both LDM and DevOps continues and provides differentiated and superior technology offerings for our customers.

As I said before, the recovery of Cirata, is likely to be non-linear but no-one should underestimate the focus we are placing on sharpening and improving our pipeline visibility and predictability.  With the sales team now fully set, and with partner and customer interactions building, we remain focused on delivering against the guidance range and phasing we have set out for the year as a whole."

This announcement contains information that qualifies or may qualify as inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the company's obligations under Article 17 of MAR.

The person responsible for arranging the release of this announcement on behalf of Cirata plc is Larry Webster, Company Secretary. 

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About Cirata

Cirata, accelerates data-driven revenue growth by automating data transfer and integration to modern cloud analytics and AI platforms without downtime or disruption. With Cirata, data leaders can leverage the power of AI and analytics across their entire enterprise data estate to freely choose analytics technologies, avoid vendor, platform, or cloud lock-in while making AI and analytics faster, cheaper, and more flexible. Cirata's portfolio of products and technology solutions make strategic adoption of modern data analytics efficient and automated. For more information about Cirata, visit www.cirata.com