McDonald's opts in as Plexure seeks capital and an ASX listing

McDonald's opts in as Plexure seeks capital and an ASX listing

Platform costs are increasing alongside revenue growth

Phil Norman (Plexure)

Phil Norman (Plexure)

Credit: Supplied

Fast food giant McDonald's will invest more in mobile engagement systems developer Plexure as the Kiwi tech provider seeks a secondary listing on the Australian Securities Exchange (ASX).

Plexure is raising A$30 million (NZ$32 million) in a private placement to institutional and sophisticated and professional investors to fund growth and seeking a secondary ASX foreign exempt listing.

Key customer and shareholder McDonald’s will participate in the placement to maintain its current 9.9 per cent shareholding, Plexure told shareholders this morning.

A non-underwritten share purchase plan of up to NZ$5 million will enable local shareholders to participate on the same terms as the placement.

Plexure also announced its first half results, with revenue growing 23 per cent to NZ$14.4 million. Revenue guidance for 2021 is NZ$29.1 million, a 14 per cent increase on 2020.

The new funds will be used to increase staffing to support customer expansion in new verticals and geographies; in product innovation including data analytics, artificial intelligence (AI) and machine learning and platform capacity; and to provide working capital.

Plexure had previously announced it was considering a possible IPO and ASX listing — and re-classifying its NZX listing to a secondary listing and had received shareholder approval for that. 

However, it has has now determined that the most efficient way to achieve an ASX presence was to undertake an underwritten private placement to institutional and sophisticated and professional investors in Australia and New Zealand, seek a secondary ASX listing and maintain its NZX listing as its primary listing. 

The company said it may migrate to a primary listing in Australia at a later date.

Plexure chair Phil Norman said the company had established itself as a leading international specialist mobile engagement platform and a key marketing partner to well-known consumer brands operating in high-frequency physical environments such as grocery and quick service restaurants. 

"The Plexure platform delivers seamless personalised offers at scale to more than 210 million customers in 60 countries via their mobile devices to incentivise them to visit physical stores," he said.

That includes McDonald's store networks in multiple geographies.

“The offer provides us with the opportunity to accelerate the strong international growth trajectory we have achieved in recent years through investment in our sales function," Norman said.

"It will also allow us to continue to remain at the forefront of data-driven analytics and the use of AI and machine learning by developing further enhancements to our platform and allowing for increased expansion in other geographies and verticals."

However, while revenues have continued to grow so have platform costs. 

The company’s cost base increased by 79 per cent to NZ$18.8 million, compared with the same six-month period last year (NZ$10.5 million), as it invested in product and platform development, staff, and professional costs.

First half recurring revenue (licence and support fees) increased by NZ$1.7 million, or 19 per cent to NZ$9 million, while non-recurring revenue increased by NZ$1.2 million, or 22 per cent to NZ$5.3 million. 

Increased users and platform activity had driven growth in IT costs from NZ$2.6 million to NZ$4 million. 

During the period, Plexure also incurred some dual running costs as it moved parts of its platform between cloud providers. 

Re-architecting and modernising the platform remained a key focus for the business.

Plexure was recently included in the 2020 Gartner Magic Quadrant for mobile marketing platforms.

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