Esker achieves a new record quarter with sales exceeding 32% growth

Esker:

Esker has decided to adjust its revenue presentation by activity to reflect the strategy of focusing on the cloud and the increasingly smaller share of legacy products and license-based document process automation solutions. Therefore, Fax, Host Access and Esker DeliveryWare products are grouped under legacy products. For cloud solutions, Esker will now distinguish between the purely SaaS part (subscription and traffic) and the implementation services part. Esker has also decided to report its bookings using Annual Recurring Revenue (ARR), a standard metric for SaaS or subscription business. ARR is the average annual subscription value that customers commit to pay over the life of a contract. Revenue from platform transactions is not included as it is uncertain by nature and depends on the number of transactions effectively processed, which is not known at the time the contract is signed. Service revenue is also not included in ARR as it is non-recurring.

Record quarter, record half year

Esker Q2 2021 sales revenue amounted to 33.4 million euros, a 32% increase over Q2 2020 based on constant exchange rates (+28% based on current rates). Half-year sales revenue grew 22% based on constant exchange rate (19% based on current rates) to 64.4 million euros. Esker has, once again, experienced its most successful quarter and half year in company history.

Growth continued to be driven by the development of cloud solutions, which grew 37% in Q2, representing 93% of the company business. In addition to its usual growth, the company’s cloud-based activities also benefited from a favorable base effect in Q2. In the second quarter of 2020, the variable share of cloud-based activities was impacted by the COVID-19-driven economic slowdown in numerous countries.

Activity was strong in all geographies, with all posting solid growth as a result of sales success recorded over the last six months. Implementation services grew significantly (+13%) due to the large number of continued bookings since the end of 2020. The performance of traditional license-based products and legacy products increased considerably in Q2 thanks to an unexpected sale in the U.S.

Significant number of new contracts signed

Esker signed a high amount of new contracts over the quarter. More than ever, businesses have shown a strong interest in automation solutions that deliver significant productivity gains to finance and customer service functions and allow them to continue to operate when employees are working remotely.

The Annual Recurring Value (ARR) of new contracts signed during Q2 2021 increased by 92% compared to Q2 2020, to reach 3.3 million euros (10.6 million euros in subscriptions over the total duration of the contracts). The pace of signatures was dynamic in all regions of the world and particularly intense in the U.S. and France. Since the beginning of the year, the ARR of contracts signed amounts to 6.6 million euros, an increase of 64% (21.3 million euros in subscriptions over the total duration of the contracts).

Maintained profitability and financial structure for future growth

As of June 30, 2021, company cash rests at 35.2 million euros after dividend payment and reimbursement of a government-guaranteed loan of 11.5 million euros. With 33.6 million euros in net cash (versus 22.9 million euros on June 30, 2020) and close to 140,000 treasury shares immediately available, Esker has the financial resources necessary to pursue its strategy focused on accelerating organic growth. This will eventually be completed by external growth operations designed to integrate related solutions to increase the value delivered to our customers.

Outlook for 2021

Esker’s growth should continue to accelerate over Q3 due to the significant sales success achieved since Q4 2020, the strong economic recovery worldwide and a continued favorable base effect. Esker has raised its organic growth forecast for the full year from 16% to 17%, which should bring sales revenue to around 131 million euros if the EUR/USD exchange rate remains unchanged. At this level of growth, profitability is expected to be between 12-15%.

About Esker

Esker is a global cloud platform built to unlock strategic value for finance and customer service professionals, and strengthen collaboration between companies by automating the cash conversion cycle. Esker’s solutions incorporate technologies like Artificial Intelligence (AI) to drive increased productivity, enhanced visibility, reduced fraud risk, and improved collaboration with customers, suppliers and internally. Esker operates in North America, Latin America, Europe and Asia Pacific with global headquarters in Lyon, France, and U.S. headquarters in Madison, Wisconsin. For more information on Esker and its solutions, visit www.esker.com. Follow Esker on LinkedIn and join the conversation on the Esker blog at blog.esker.com.

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