Document management software provider Invu halved its operating losses in the first half ending 31 July to £0.2m, down from £0.4m in the previous first half, lifting revenues 4.5 per cent to £1.32m.
Colin Gallick, chief executive officer of Invu, said: "We continue to make steady progress in the improvement of the trading performance, while the loan note conversion has significantly strengthened our balance sheet and provided us with a sound financial base."
According to Gallick, the main points included a capital organisation that increased equity by £3.05m, despite only needing to borrow £0.7m in the half – down from net borrowings of £2.4m in the year-ago half.
Furthermore, software and services sales went well in verticals such as accountancy, as did Invu's Iris software house contract, which was responsible for 20 per cent of its new customer sales in the half ending 31 July 2011. Top new customer was stockbroking firm Redmayne.
"Invu remains focused on cash generation," he added in a statement. "We achieved a significant improvement in adjusted EBITDA, reporting a break-even result compared to a £0.2m loss in H1 [last year]."
Most sales of its SMB-focused apps were in the UK, although the firm does have a Dutch reseller, Kompro, which it signed up in March, and is adding more mid-sized firms into its customer mix. In total, it has 1.681 customer sites.
"During the period we won deals with 84 new customers, compared with last year's 112 new customers, and saw our average deal size increase 26 per cent," Gallick said.
Resellers were instrumental in Invu's success, as was making better use of resources than previously, he suggested.
"Our primary route to market is our reseller channel, with 78.4 per cent of sales," Gallick said. "Over the last two years we have reorganised this channel – a reduction from 200 to 50 reseller partners was implemented in 2010 – and we now see 93 per cent of our of reseller sales through our top 20 resellers."
Sales actually declined
Market-watcher TechMarketView noted this morning that the firm's software and related services sales actually declined by £0.1m the first half – although the average deal size expanded 26 per cent.
"While it was the sale of support contracts that boosted the revenues – from £0.7m to £0.8m. We had previously commented that the focus on larger businesses within the SME sector would have a positive impact on maintenance revenue and that appears to be the case," said TechMarketView analyst Georgina O'Toole.
"However, it's not great to see software and related services revenues on the downward trajectory at the same time. In addition, it was the European business (£39K of revenue compared to £5K in H1 of 2011) that really drove growth. It looks like UK revenues managed an increase of just one per cent.
"The hill still looks pretty steep."
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