OXATIS (EPA:ALOXA) - A semester of action and structural enhancement as Oxatis prepares to ramp up growth

Transparency directive : regulatory news

29/10/2018 17:45

PRESS RELEASE
Paris, 29 October 2018

A semester of action and structural enhancement as Oxatis prepares to ramp up
                                    growth

    Increased international presence with the acquisition of Channel Pilot
                             Solutions in Germany

                    Projected growth of more than 30% in H2

                             Reiterated ambitions

Today, Oxatis (ALOXA - FR0013328184) is releasing its results for first-half
2018 and announcing the acquisition of Channel Pilot Solutions in Germany. This
acquisition has propelled Oxatis into a new phase of its ambitious strategy
aimed at building a European leader in e-commerce SaaS solutions. Oxatis has
also confirmed the growth and profitability targets presented in the context of
its IPO.

The transaction was approved by the Board of Directors at its meeting of 24
October 2018 and finalised on 26 October 2018.

Decisive progress on the execution of the strategic plan

Oxatis made great strides in the execution of its strategic plan over the first
half year, paving the way for accelerated growth, in line with the targets set
out during the IPO.

Working with larger clients

In the first half year, top priority was given to working with larger clients,
which has led to longer selling cycles. Focusing on a client segment that
offers such high income potential will have a positive impact on revenue growth
in the second half of the year.

Performance-based pricing

The Group changed its pricing system early in the year, adopting a monthly
subscription model that includes a performance-based revenue component. This
new pricing model is set to be a major growth driver, generating additional
revenues linked directly to the performance of merchants using the Oxatis SaaS
platform. It has been applied to all new clients since May 2018. The Group has
also begun switching its existing client base over to the new pricing model.
The changeover initially weighed on business in the first half, particularly on
the international market. In the second half, however, profits from the new
pricing system will start to roll in and boost growth.

Development of indirect sales

Oxatis has also stepped up its efforts to develop its indirect sales, a
decisive move designed to improve margins by reducing client acquisition costs.
In keeping with its ambitious strategy, Oxatis announced in June that it had
entered into a new partnership with Crédit Mutuel CM11 - CIC with the aim of
selling the Oxatis e-commerce SaaS solution across its banking networks (which
account for two out of five corporate clients in France). Sales through
indirect channels were up 73% year-on-year in H1 2018, accounting for 15% of
revenues versus 9% in H1 2017.

Expanding the team

Finally, the Group hired new employees to support the expected ramp up of
activity. Compared to 30 June 2017, the total headcount increased 15% (from 157
to 180 employees).

Activity and earnings reflecting the transformation in progress

H1 activity and earnings reflected the Group's ongoing transformation.

The Board of Directors met on 10 October 2018 to approve the Group's financial
statements for the first half of 2018.

in EURk - at 30 June - unaudited data          H1 2018     H1 2017

Revenue                                         4,953       4,683
Operating income (expense)                     (1,729)       (885)
Income from consolidated companies             (1,749)       (873)
Group net income                               (1,749)       (876)

As announced on 25 July, revenue for the first half of 2018 came out at
EUR5.0m, an increase of 5.8%. France (84% of H1 revenue) was once again the
main growth driver over the period, with EUR4.2m in revenue, up 11%.

The Group turned in an operating loss of EUR1.7m, versus a loss of EUR0.9min H1
2017, including an increase of nearly EUR1.3m in personnel expenses stemming
from recruitment. The other expense items remained in line with plan.

Group net income turned out negative at -EUR1.7m.

A stronger financial position

Oxatis is now in a stronger financial position to implement its ambitious
strategy thanks to the funds raised from its IPO on Euronext Growth Paris
(EUR11.9m) in April. The net cash position of the Group's financial debt stood
at nearly EUR11m as of 30 June 2018.

Acquisition of Channel Pilot Solutions, a German company specialising in SaaS
solutions designed to process and optimise e-commerce data feeds Key position
achieved in Artificial Intelligence, a new challenge for e-commerce

Today Oxatis announces the acquisition of Channel Pilot Solutions, a company
specialising in SaaS solutions designed to process and optimise e-commerce data
feeds, based in Hamburg, Germany.

Founded in 2012, Channel Pilot Solutions develops and sells technology
solutions allowing online merchants to list their catalogues on all the
influential marketing networks (price comparison sites, marketplaces, etc.),
analyse their performances and optimise product marketing.

These solutions are based on expertise in the field of Artificial Intelligence
(AI), which has been incorporated into tried and tested, complex algorithms, as
well as the roll-out of cutting-edge data processing tools.

Channel Pilot Solutions generated revenue of EUR2.5m in fiscal year 2017, a
growth of more than 44%, with positive EBITDA of EUR229k. Growth of revenues
topped 45% in first-half 2018.

Channel Pilot Solutions earns 84% of its revenue in Germany, Austria and
Switzerland. In addition to its registered office in Hamburg, the company has
offices in Paris, London, Madrid, Milan, Moscow and Palo Alto. Channel Pilot
Solutions employed over 40 people at end-June 2018.

Channel Pilot Solutions will be included in the Group's consolidated financial
statements from 27 October 2018.

There are several benefits to this strategic acquisition for Oxatis.

Penetration of the second largest e-commerce market in Europe

With this deal, Oxatis has secured a position on the No. 2 e-commerce market in
Europe. B2C revenue exceeded EUR85 billion in Germany last year and is expected
to reach EUR93 billion in 2018 (i.e. up by almost 10% year-on-year(1)).

Had Channel Pilot Solutions been consolidated over the full year, Oxatis would
earn more than EUR4m in revenues outside France for the full year. Oxatis will
now boast a solid foundation for development in Europe's top e-commerce
markets: France, United Kingdom, Germany, Spain, Italy.

This expansion is a key milestone in the Group's plan to establish itself as a
European leader in e-c ommerce SaaS.

Strong technological synergies, 100% SaaS solutions that can be easily
integrated on the Oxatis platform

Channel Pilot Solutions develops innovative multi-channel solutions designed to
maximise visibility and boost online sales:

- Access to the main international price comparison sites (Facebook, Google
  Shopping, Kelkoo, Le Guide, etc.)

(1) Centre for Retail Research. 2017 E-commerce Foundation.

- Product catalogues connected to leading marketplaces (Amazon, eBay, Otto,
  Rakuten,, etc.)
- Product listing and optimisation on Google Shopping, managed according to
  profit margin strategy
- Market price analysis and incorporation of competitive conditions in defining
  a dynamic catalogue pricing policy
- Data analysis and optimisation tools

All these solutions are the result of over 6 years of R&D investments (over 20%
of revenue was devoted to developing these solutions in 2017).

Channel Pilot Solutions's products are available in SaaS mode and are billed on
subscription, including a performance-based pricing component, in line with the
new billing model employed by Oxatis.

These cutting-edge solutions will strengthen the Oxatis technology platform,
which already boasts more than 400 features to help companies launch and
develop their online shop. Incorporating AI expertise, applied in particular to
dynamic catalogue pricing solutions, will give Oxatis a real competitive edge.

Addition of a portfolio of medium enterprises and large corporates, in line
with the Group's strategy to work with bigger clients

Thanks to Channel Pilot Solutions (CPS), Oxatis will be adding a portfolio of
more than 400 new clients totalling over EUR1 billion orders per year. Medium
entreprises and large corporates are highly represented in this portfolio,
including Top Tier players in all market sectors. Over 30% of the Top 2000
online shops in Europe currently use CPS solutions. Some of the biggest names
in the portfolio include Decathlon, El Corte Ingles, La Redoute, Lindt,
Mercedes, Mephisto, Nespresso, Pandora, Sarenza, etc.

The quality of this portfolio, benefiting from high repeat business, goes
hand-in-hand with Oxatis' strategy of working with bigger clients in a bid to
boost the value creation potential of its client base. It will also raise the
commercial appeal of the Group's solutions in France and around the world in
the coming months.

Founders personally invested in a successful consolidation

Oxatis will be aided in completing the successful consolidation of Channel
Pilot Solutions by co-founders Lars Niemann, Head of R&D and CTO, and Ralf
Priemer, Head of Marketing and Sales Development. Drawing on years of
experience in international e-commerce, both become co- managing directors of
the acquired company. They are now fully invested in seeing this project
through.

Acquisition financing and conditions:
cash payment and capital increase, with elimination of pre-emptive subscription
rights, with subscribed shares paid up by offsetting the debt against a
fraction of the acquisition cost Capital increase based on a price of EUR11.20
per share

The sale of all the share capital comprising Channel Pilot Solutions was
approved by the Board of Directors on 24 October 2008 via cash payment and
payment in Oxatis shares.

As consideration for the debt owed on a portion of the selling price, the Board
of Directors elected at the same meeting to carry out a capital increase via
private placement, within the meaning of Article L. 411-2 of the French
Monetary and Financial Code, with the subscription price paid up by offsetting
it with an unquestionable, liquid claim enforceable against the Company.

In accordance with the delegation of power granted by the eighth resolution of
the Combined Shareholders' Meeting of 20 March 2018, on the basis of Article L.
225-136 of the French Commercial Code and Article L. 411- 2 II of the French
Monetary and Financial Code, the Board of Directors elected on 24 October 2018
to carry out a capital increase, with the elimination of pre-emptive
subscription rights, via private placement in favour of the sellers of Channel
Pilot Solutions, with the exception of TFO GmbH, in the following proportions:

- Mr. Lars Niemann: 44,783 new shares,
- Mr. Ralf Priemer: 44,783 new shares,
- Mr. Mirko Platz: 44,783 new shares,

who together form a limited circle of investors acting on their own account.

The nominal amount of the capital increase was set at EUR67,174.50, through the
issuance of 134,349 new ordinary shares in the aforementioned proportions,
representing a global capital increase (including additional paid-in capital)
of EUR1,504,708.80. The capital increase was based on a price of EUR11.20 per
Oxatis share. Lastly, the Board of Directors which met on 24 October 2018
sub-delegated the power to carry out the capital increase to its Chief
Executive Officer.

In a ruling dated 26 October 2018, the Chief Executive Officer, exercising the
power duly granted by the Board of Directors:

- set the amount of the sellers' claim, for the purposes of paying up the
  subscriptions for the new ordinary shares to be issued in the capital
  increase;
- noted that a fraction of the selling price would be offset with an
  unquestionable, liquid claim enforceable against Oxatis;
- noted that, in accordance with the provisions of Article R. 225-134 of the
  French Commercial Code, the statement of claims was certified as accurate by
  the Statutory Auditor of Oxatis;

In addition to this ruling, the Chief Executive Officer also:

- noted that the designated sellers paid up their subscriptions through the
  remittance of their subscription forms, offset with liquid claims enforceable
  against Oxatis, which were recorded in an accounting statement certified as
  accurate by the Statutory Auditor;
- consequently noted that the sum of EUR1,504,708.80 had been paid up in full;
- consequently noted that the capital increase, with a nominal amount of
  EUR67,174.50, had been fully subscribed and thus completed.

For information purposes: a shareholder owing 1% of Oxatis' share capital prior
to the capital increase will now own 0.97%.

Under the terms of the agreements concluded for the purposes of the acquisition
of Channel Pilot Solutions, the parties agreed to establish an additional
consideration in favour of the sellers, provided that Channel Pilot Solutions
validates its guidance for fiscal year 2018, the amount of which may be
impacted by the assets and liabilities pledged as collateral by the sellers. If
due, this additional consideration would be paid in four instalments (spread
out from 2019 to 2022) and would be payable 50/50 in cash and new shares to be
issued by Oxatis.

For information purposes: based on the same Oxatis share price used for the
payment in shares effected on today's date (i.e. EUR11.20) and provided that
the aforementioned targets are achieved and the assets and liabilities pledged
as capital are not called up, a shareholder owning 1% of Oxatis' share capital
prior to the capital increase would own 0.94% of the share capital.

The 134,349 new shares are scheduled to be admitted to trading on Euronext
Growth on 29 October 2018. These shares will be subject to all provisions set
forth in the by-laws and will be treated as existing ordinary shares bearing
current dividend rights as of settlement-delivery.

When signing the documentation pertaining to the capital increase, the sellers
and new Oxatis shareholders also signed an agreement to hold the company's
shares for a period of one year from the settlement-delivery date, subject to
the usual exceptions.

In accordance with Article 211-3 of the AMF General Regulations, the capital
increase mentioned above did not give rise to an obligation to issue a
prospectus approved by the AMF.

Strata Partners, the London-based independent corporate finance partnership,
acted as exclusive financial adviser to Oxatis. Warth & Klein Grant Thornton
provided due diligence and legal advice in Germany, and Lamy Lexel provided
legal advice in France, in support of the success of the transaction.

Growth of more than 30% expected in H2
Full-year target: >20%

The acquisition of Channel Pilot Solutions shores up Oxatis' solid outlook.
Growth should gather pace in the second half, with revenue expected to climb
over 30% year-on-year. The Group targets growth of more than 20% for full-year
2018.

As previously announced, this growth will be driven by the initiatives taken in
the first half: roll-out of the new billing method, growing contribution of
indirect sales, and addition of larger clients.

As a matter of fact, when it comes to working with larger clients, the Group
kicked off the second half by welcoming several high-potential players such as
Molinard, Campingaz-Shop, NSH Group (which owns the MISAKI(r) jewellery brand,
among others), Planet Line, etc.

Business in the second half is also set to benefit from the first few months of
consolidation of PowerBoutique, the French e-commerce SaaS specialist purchased
in July 2018. As announced, PowerBoutique should contribute over EUR1m to Group
revenue in H2.

Reiterated ambitions

In light of these supportive factors, Oxatis has reiterated its guidance for
2020: doubling the company's size and generating more than EUR20m in revenue.
Its profitability targets have also been confirmed, with the aim of achieving
positive EBITDA from 2020 and a double-digit operating margin by 2023.

Oxatis is forging ahead with its market plan, determined to establish itself as
a European leader in e-commerce SaaS, drawing on a business model combining
technological advances, new client business and an ambitious acquisition
strategy.

                                    - END -

ABOUT OXATIS

Oxatis is the leading e-commerce SaaS solution in Europe with more than 8,500
SME clients since the acquisition of PowerBoutique. It is perfectly able to
meet the needs of companies earning EUR100k to EUR30m in online revenue. Oxatis
is a certified Google Premier Partner, recommended by Sage, and the exclusive
solution chosen by Crédit Agricole, Crédit du Nord Group, Crédit Mutuel-CIC
Group and CEPAC. Oxatis has been listed on Euronext Growth - ALOXA since April
2017 and bought PowerBoutique in July 2018. Oxatis operates in four European
countries (France, United Kingdom, Spain, Italy).

For more information, go to www.oxatis.com

CONTACTS

Oxatis
Jean-Christophe Brun
+33 (4) 86 26 26 26
investor@oxatis.com

Corporate Press Relations
Bruno Lorthiois
+33 (6) 78 97 07 24
blorthiois@lablcom.net

Financial Communications
Victoire Demeestère
+33 (1) 56 88 11 24
vdemeestere@actifin.fr

Financial Press Relations
Isabelle Dray
+33 (1) 56 88 11 29
idray@actifin.fr

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