Getech (AIM: GTC), a world-leading locator of subsurface resources, is pleased to provide the following trading update for the financial year ended 31 December 2024.
The Company expects to report a 17% increase in revenues to £4.7m (2023: £4.0m). The rise in sales came from the retained client base and new services income from the growing portfolio of work supporting sub-surface exploration for materials connected to the Energy Transition such as natural or white hydrogen, battery materials or geothermal sources of energy. The Group orderbook as at 31 December 2024 was £4.1m (2023: £4.5m), with the slight reduction due to the successful unwinding of the contracted orderbook to revenue during the year.
Annual recurring revenue ("ARR") in FY24 was £2.9m (2023: £2.8m) with the management team continuing to focus on expanding ARR income through a subscription model and aiming to both add new clients and increase the scope of services and value-add provided to existing clients.
In August 2024, the Company raised gross proceeds of £1.7m through a Placing and Retail Offer, thereby strengthening the financial position of the Company and providing new capital to invest in the Group's sales and R&D teams. As at 31 December 2024, the Company had net cash of £0.9m (including a £0.1m project security bond).
Cost reduction activity was a key focus in 2024. Approximately £2m of annualised costs have been taken out of the business alongside the closure of the H2 Green projects. However, the cost reduction programme has taken longer to implement than initially estimated, impacting the EBITDA margin in FY24, and EBITDA is expected to be in the region of £0.5m loss (2023: £2.7m loss).
Having sold part of the Company's HQ in January 2024, the final building, Nicholson House, is currently under offer. Once sold, this will release £300k of net proceeds back to the business after repayment of the secured working capital facility.
The Company continues its diversification beyond the Group's core oil and gas sector clients into the Energy Transition. Utilising its market leading globally comprehensive magnetic, gravity and geoscience data, Getech is applying advanced AI and ML to search for new mineral and energy assets to accelerate the Energy Transition.
Natural hydrogen is an area of strength as potential hydrogen source rocks can be quite clearly fingerprinted in magnetic and gravity data. Given this, Getech is quickly establishing itself in this nascent but potentially vast market, working on several searches during the course of 2024 alongside developing new joint exploration agreements which have the potential to move the Company from being a service provider to be more akin to an explorer with the possibility of greater commercial returns.
Geothermal is another area of expanding business development for Getech. For institutions and companies geothermal can be a highly sustainable and economic solution to meet future energy requirements. In July 2024, Getech was contracted to conduct a country-wide search for geothermal energy sources at a value of more than £180k, which represented the largest consulting project the Company has completed in recent years.
Outlook for 2025
As part of our drive to increase revenues, the team was expanded with two sales hires in recent months, both focused on increasing recurring revenue from the Globe family of geoscience products and services. We see demand for data-led exploration increasing, particularly from organisations seeking to locate natural resources essential for the Energy Transition and expect to benefit from the investments we have made. We are expanding the drive to reduce costs and so better align the business with our revenue base. The Board is confident of a continued improvement in trading and in the outlook for the business.