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Cloud-based software provider Rosslyn Data Technologies (LSE:RDT) announced on Wednesday that it has secured a significant new client contract worth at least £2.0 million. This development follows the company reporting underlying losses for the fiscal year 2024 that were better than anticipated.
Rosslyn Data's annual revenues remained relatively stable, showing a slight decrease from £3.0 million to £2.9 million. This drop is primarily attributed to a £100,000 reduction in annual recurring revenues, which fell to £2.3 million. This reduction reflects the extended timelines associated with finalizing contracts for substantial new opportunities. The company also indicated an improvement in gross margins, which are projected to be around 39%, compared to 34.7% in the previous year.
The AIM-listed company is poised to report full-year adjusted underlying losses of £2.5 million and an overall LBITDA of £3.3 million, compared to £2.0 million and £2.4 million respectively from the prior year. Despite these figures, they were better than internal projections, largely due to the company’s strategic emphasis on sustainable growth and high-quality revenue generation.
In addition to the financial updates, Rosslyn Data revealed that it had secured a three-year contract with one of the world's largest technology firms. This contract, valued at a minimum of £2.0 million, is expected to open doors for further growth through potential expansion into additional divisions and operations within the client’s network.
Chief Executive Paul Watts highlighted the significance of this new contract, describing it as a major commercial achievement with considerable growth potential. The appointment is seen as a strong endorsement of Rosslyn Data's offerings and its artificial intelligence strategy, which played a crucial role in winning the competitive tender. The partnership also includes a co-innovation agreement, with the customer investing in collaborative development efforts.
As a result of the positive news, Rosslyn Data’s shares surged by 54.32% to reach 14.28p by 1150 BST.
