Synchronica Announces Strong Fourth Quarter Results with 2010 Revenue Increasing 86 Percent over 2009
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o Strong deal flow with five carrier contract wins and two device manufacturer contract wins in the fourth quarter 2010
o Approximately USD 11 million in revenue in 2010, an 86 percent increase over 2009 (USD 5.9 million)
o Total number of operator customers increased to 71, up from 20 in 2009
o Addressable user market expanded to over one billion users, compared to 331 million in 2009
Royal Tunbridge Wells, February 7, 2011. - Synchronica plc (AIM: SYNC, TSX-V: SYN), the international provider of next-generation mobile messaging services, announces the following trading update for the year ended 31 December 2010.
Synchronica recorded strong growth in 2010 and an extremely strong end to the year, increasing its customer base both organically, as well as by acquisition. In the final quarter of 2010, Synchronica won an additional five mobile operator contracts and closed two new device manufacturer deals.
Synchronica also received expansion orders from two existing operator customers for additional Mobile Gateway user licences. Synchronica remains confident that it has the right distribution channels, product, and skills in place to grow further and expand the customer base in the future.
For 2010, Synchronica had revenue of approximately USD 11 million (2009: GBP 3.83 million or USD 5.9 million), an increase of 86 percent over fiscal year 2009. The company recorded a very strong fourth quarter with revenues of approximately USD 5.3 million, and the full-year revenue of 2010 was slightly above most recent analyst note and broadly in line with consensus.
Increased Contribution from Recurring Revenue
In 2010, Synchronica also diversified its business model, combining both perpetual and recurring revenue licence agreements. This is starting to show positive results with an increased contribution from recurring revenue resulting in a more predictable revenue and cash flow.
Carsten Brinkschulte, CEO of Synchronica, says: "The fourth quarter of 2010 was a strong growth period for Synchronica, continuing the success we had in the rest of the year. In particular, the significant growth in operator customers, which has tripled our addressable user market, positions us well for continued growth."
"Device manufacturer contracts were also a strong contributor to revenue in 2010, Synchronica signed two contracts with device manufacturers last year each with a value of over USD 1 million", Brinkschulte adds.
Synchronica's success to date is the result of its strategy of focussing its business on opportunities in high-growth emerging markets. As at the end of December, Synchronica had expanded its customer base almost fivefold to 71 mobile operator customers (2009: 20 operators), representing an increase of some 200 percent amongst the combined addressable user base that now comfortably exceeds one billion (2009: 331 million).
Synchronica's growth strategy has resulted in a global customer base encompassing over 40 countries and five continents.
Post-Period Events
Post 31 December 2010, Synchronica has announced an agreement to acquire the instant messaging business of Neustar NGM Services Ltd. This acquisition includes the related intellectual property, eleven live contracts with tier one and tier two mobile operators and two contracts with tier one device manufacturers for a cash consideration of USD 251,000 (of which USD 1,000 has been paid, and the balance of USD 250,000 is payable 90 days after closing).
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About Synchronica
Synchronica plc is a leading developer of next-generation mobile messaging solutions. Mobile Gateway, Synchronica's flagship product, provides push email, synchronization, instant messaging (IM), and social networking services to any mobile phone currently in use. Synchronica's patented transcoding engine uses advanced streaming to download email attachments and can dramatically reduce the consumption of network bandwidth by as much as 90 percent.
Mobile operators and device manufacturers from emerging and developed markets rely on Synchronica's white-labelled product for providing mass market messaging services across the entire customer base, diversifying revenues and reducing churn.
Headquartered in England, Synchronica also maintains a development center in Germany and the Philippines in addition to a regional presence in Canada, the USA, Hong Kong, Spain, and Dubai. Synchronica plc is a public company traded on the AIM list of the London Stock Exchange (SYNC) and the Venture Exchange of the Toronto Stock Exchange (SYN). For further information, please visit www.synchronica.com
For more information, please contact:
Nicole Meissner
Chief Operating Officer
Tel.: +44 1892 5527 80
Mobile: +44 7977 2564 12
Fax: +44 1892 5527 21
nicole.meissner@synchronica.com
