Kyocera Document Solutions Europe (KDE), a leading global provider of total document solutions, has selected Sidetrade to control and analyze their cash flow and enhance productivity for central EMEA. This contract covers four Kyocera territories in the UK, France, Italy and the Netherlands.
Hiroshi Takenaka, Executive Vice President, KDE, commented: In times of disruption and rapid change, businesses should focus on growth without compromising customer relationships. Through the partnership with Sidetrade, we will achieve our main objective of transforming information into a valuable asset that our organizations can leverage to drive change.
Kyocera’s eco-friendly printers, business applications and consultancy services enable customers to manage their document workflow to achieve new heights of efficiency. With Sidetrade, Kyocera can now drive growth, achieve real-time cash visibility at HQ level and optimize resource utilization within the group. Sidetrade will also enable Kyocera to enhance their Order-to-Cash processes, proactively mitigate the risk of bad debt, and improve overall performance and sustainability.
Drs. Fraz Rasool RA, General Manager, EMEA Finance, Accounting & Control Division, KDE added, Kyocera follows the Principle of Cash-Basis Management, which is a simple management style that focuses on the flow of cash. With Sidetrade, Kyocera found the right business partner that can help deliver better and faster business insight when it comes to cash collection from its valued customers.
Kyocera joins international players in the manufacturing sector who already rely on Sidetrade to simplify customer payments and provide continuous improvements to their Order-to-Cash efficiency – from e-invoicing to payment.
Jean-Claude Charpenet, VP Sales Director Europe, Sidetrade, commented: We are delighted to welcome Kyocera to the Sidetrade customer community and are looking forward to collaborating with this industry leader. It’s exciting that more major global organizations are relying on Sidetrade’s artificial intelligence and Data Lake to invoice faster, proactively drive cash flow, and accelerate payment allocation with match rates of up to 90%.
Olivier Novasque, CEO of Sidetrade commented :
After only 18 months of operations in North America, Sidetrade has taken an important step in its development, significantly outperforming its initial targets for bookings. Overall, Sidetrade delivered a record year of bookings, posting nearly €6.5 million in new Annual Recurring Revenue up +36% overall with 51% from the United States. This performance provides excellent visibility for our revenue in 2023. Significantly, Sidetrade now achieves more than half of its revenue internationally, with 24% already generated in North America.
In addition to our remarkable commercial successes, with a gross margin close to 80%, our efficient SaaS model enabled us to invest €7 million in North America for the full year while retaining an operating margin at 10% of our revenue. Sidetrade is one of those rare companies in the software industry that can invest heavily in North American expansion, with rapid and significant commercial success in return, while maintaining double-digit profitability.
Sidetrade has effectively expanded its scale and we are proud to be recognized as one of the three global leaders in the Order-to-Cash segment. Despite a background of economic uncertainty, we enter 2023 with confidence and enthusiasm, strengthened by the bookings recorded in 2022. The market outlook is buoyant against a backdrop where many companies are under pressure to secure and improve their cash flow. Once more, our robust model – which maintains a healthy balance between growth and profitability – has served to develop our strongest ever market position.
Increased robustness thanks to a profitable growth model
| Sidetrade (€m) |
2022 | 2021 | Change |
| New SaaS Subscriptions (« New ARR ») |
6.44 | 4.75 | +36% |
| of which North America | 3.27 | 1.04 | +214% |
| Revenue | 36.8 | 32.6 | +13% |
| ‘Order-to-Cash’ Activities | 35.9 | 30.3 | +18% |
| ‘Sales & Marketing’ Activities | 0.9 | 2.3 | -61% |
| Gross margin | 29.0 | 25.7 | +13% |
| as a % of Revenue | 79% | 79% | |
| Operating expenses (OPEX) | (25.3) | (20.7) | +22% |
| of which North America | (7.0) | (3.5) | +100% |
| Operating profit | 3.7 | 5.0 | -26% |
| as a % of Revenue | 10% | 15% | |
| Net profit | 3.4 | 4.7 | -28% |
2022 accounts have been audited and will be certified after finalization of procedures required for the annual financial report.
Record bookings in 2022, with more than €10 million in Annual Contract Value and €6.44 million in ARR, up +36%
In 2022, Sidetrade achieved a +36% increase in Annual Recurring Revenue (“ARR”) which totaled €6.44 million. This performance reflects the strong demand for the Company’s solutions, winning a growing number of new customers. In an ever-changing economic environment, the management of operating working capital, and particularly accounts receivable, is a major challenge for companies, irrespective of their sector.
In 2022, bookings linked to services (implementation, configuration and training, excluding recurring services) also achieved robust growth of +37%, amounting to €3.84 million. Considering that almost all of these services will be invoiced over the next twelve months (excluding recurring services which can be invoiced over several years), Sidetrade adds the equivalent of €10.28 million in Annual Contract Value (“ACV”), representing a +36% increase.
United States – a robust growth driver with 51% of bookings in 2022
Sidetrade continued to increase international orders, which represented 66% of all bookings in 2022. The commercial success in the United States was especially significant on a half-yearly basis, since the US already represented more than half the total bookings (51%) on a full-year basis in 2022.
The contracts won in preference over American competitors demonstrate, on the one hand, Sidetrade’s technological edge – recognized as one of the three global leaders in Gartner’s 2022 Magic Quadrant™ for Integrated Invoice-to-Cash applications – and on the other, the delivery capacity and execution of the salesforce, which will continue its ramp-up in the quarters ahead.
In 2022, Sidetrade reported a dramatic increase of +60% in the total value of these new subscription contracts (“Total Contract Value” or “TCV”) over their initial contract periods (excluding renewals and services) which reached €20.7 million. In particular, this surge is attributed to an extension of the initial contract period for new customers (excluding renewals) to 44.9 months, thereby increasing the economic model’s high predictability.
Overall, in FY 2022, bookings by new customers and cross-selling represented 80% of total bookings, with the remaining 20% of bookings accounting for upselling of additional modules to existing customers compared to 28% in FY 2021.
Lastly, churn rate for enterprise accounts remains under control at 3.83% as of December 31, 2022, significantly below the SaaS industry’s average of 14% according to the “2022 Private SaaS Company Survey Results“ by KeyBanc Capital Markets.
Strong increase in ‘Order-to-Cash’ revenue to +18%, driven by ‘Order-to-Cash’ SaaS subscriptions, up 22%
‘Order-to-Cash’ activities, which form a core business within the Company’s strategy, represented 98% of total revenue at end-2022. In FY 2022, these activities increased by +18%, mainly due to strong growth in SaaS subscriptions (+22%). This increase is the result of record bookings in the 2021 fiscal year and early fiscal 2022, which continued to have an impact throughout the 2022 fiscal year.
As announced, the ‘Sales & Marketing’ activities accounted for only 2% of total revenue at end-2022, and will continue to decline, with estimated revenue of €0.5 million at end-2023. In 2022, the negative impact on total revenue growth was 5% (18% for ‘Order-to-Cash’ activities vs. 13% growth in total) and will automatically have considerably less impact in 2023.
Sidetrade’s revenue is also underpinned by vigorous growth in international markets which, for the first time, represents more than half its revenue (54% of total revenue), including 24% for North America.
Total revenue grew by +13% in FY 2022, to €36.8 million.
With a backdrop of economic uncertainty, Sidetrade’s economic model provides its business with significant resilience, as 90% of its revenue is recurring. It should be noted that all Sidetrade subscription contracts, including new contracts, contain an annual automatic price re-indexation clause based on the Consumer Price Index (CPI) for the relevant country.
With its sound fundamentals and a highly favorable growth outlook, Sidetrade has excellent pricing power that protects the Company’s future revenue against inflationary pressures.
In respect to fiscal 2022, the impact of exchange rates on the Company was not material.
Strong results in a context of accelerating investment
Outstanding gross margin at 79% of revenue, above the SaaS industry average
Gross margin remained at a very high level, topping out at 79% of revenue for 2022, with a rate of 92% on SaaS subscriptions alone. This performance was driven both by a commercial strategy to promote Sidetrade’s technological edge and costs which were kept under control in an inflationary environment.
Sidetrade continues to illustrate the robustness of its SaaS model, which generates significant incremental gross margin, year after year.
Double-digit profitability at 10%, despite investment of €7 million in North America
Operating profit for 2022 totaled €3.7 million, representing 10% of revenue. The Group retained its profitability in double digits under the combined impact of revenue growth, an excellent gross margin and efficient cost control.
Bolstered by its robust economic model, Sidetrade has undertaken an unprecedented effort to accelerate investment in North America, which amounted to €7 million in 2022 focused on building a team of 52 colleagues in the region to end of 2022.
Operating profit for 2022 includes a French Research Tax Credit and subsidies of €2.7 million (vs. €2.2 million in 2021) as well as activation of €0.3 million in marginal R&D costs, i.e., 4% of R&D costs for the full year.
Corporate income tax for 2022 totaled €0.4 million, versus €0.3 million in 2021.
All told, Sidetrade’s net profit for 2022 was €3.4 million, demonstrating that growth and profitability are achievable while investing.
Solid financial position
Sidetrade reported €20.3 million in gross cash at year-end (vs. €18 million in 2021). As of December 31, 2022, Sidetrade also holds 85,000 of its own shares with a value of €12.8 million.
Sidetrade’s financial debt stands at €12 million (fixed rate at 1.1%), giving the Group significant investment capacity to accelerate its expansion.
Responsible growth for Sidetrade with a full assessment of its environmental impact
In addition to its robust financial results, Sidetrade is committed to a CSR (Corporate Social Responsibility) approach. The latter centers on integrating ESG (Environmental, Social, Governance) challenges into its company strategy.
While Sidetrade is not yet bound by regulatory requirements, as an industry-recognized leader, the Company understands the significant role it has in shaping a more responsible and sustainable future. With this in mind, Sidetrade has already performed a comprehensive Carbon Assessment (scopes 1, 2 and 3) for FY 2022, which applies to activities and regions across the board. This assessment helped the Group to pinpoint the main greenhouse gas emission sources and identify concrete actions to regulate them.
Humble in its approach, Sidetrade is committed to a purposeful and proactive CSR strategy, backed by its participation in the United Nations Global Compact (see press release of 15 February 2023) and in compliance with the European Union’s Corporate Sustainability Reporting Directive (CSRD). Through this commitment, the Company is convinced that it will cement its industry-leading position.
Strengthened by these results, Sidetrade looks ahead to fiscal 2023 with confidence and a clear vision and has the resources to fulfill its ambitions.
Sidetrade has no exposure to Silicon Valley Bank or any of its subsidiaries.
Launched in 2000, the United Nations (UN) Global Compact is a voluntary leadership platform for the development, implementation and disclosure of responsible business practices, with over 15,000 companies and 3,800 non-business signatories based in over 160 countries and more than 69 Local Networks. The UN Global Compact calls for companies everywhere to align their operations and strategies with ten universally accepted principles in human rights, labour, environment and anti-corruption and to take action in support of UN goals and issues embodied in the Sustainable Development Goals.
Sidetrade is proud to join this community of corporates globally committed to creating a sustainable, diverse and equitable future for all.
Olivier Novasque, CEO at Sidetrade, commented: As an industry-recognized leader, we understand the significant role we have in driving positive change and being a responsible corporate citizen. We are proud to join the UN Global Compact, reinforcing our commitment to creating a better future for all.
By joining this initiative, Sidetrade leverages the Ten Principles of the UN Global Compact to build its corporate responsibility plan and will demonstrate its dedication through concrete actions.
Sidetrade has already implemented the UN Global Countdown to International Women’s Day, a gender equality learning journey. Through weekly activities from 1 February to 8 March 2023, Sidetrade employees worldwide are participating in a set of interactive and impactful experiences, offered in multiple languages.
Olivier Novasque, CEO of Sidetrade commented:
To date, fiscal 2022 represents the best performance in Sidetrade’s history, bolstered by unprecedented commercial momentum. Factoring in our 2022 bookings for new ARR and related services, in just one year, we have successfully become the equivalent of a SaaS player that is already expected to generate revenue of €10 million+ in 2023. This success is mainly the result of an inflationary environment fostering the deployment of Order-to-Cash solutions worldwide, and our technological edge in Artificial Intelligence, combined with the fast and impressive ramp-up in our North American activities. We can now confirm that our offensive US expansion strategy, kick-started 18 months ago, is producing results. North America has already proven that it is a robust growth driver for Sidetrade, and this is just the beginning. Our commercial successes with global businesses in preference over our direct North American competitors confirms the positioning of Sidetrade, which in a matter of months, has grown into a leader of the Order-to-Cash market in the United States. Together, we are proud of what we have achieved. As such, I wish to commend our teams across the board for their commitment, talent and resilience. Against a highly volatile and uncertain background of increased redundancy and cost reduction plans within SaaS companies, Sidetrade’s original model to continue an offensive investment policy and support its growth while maintaining profitability will provide a key competitive advantage in the months ahead..
All-time record bookings in 2022 with more than €10 million in Annual Contract Value, and €6.44 million in ARR, up 36%
Excellent Q4, in line with performance for 2022
After setting a record for SaaS bookings in Q1 2022, Sidetrade delivered the best Q4 performance in its history with a profit of €2.03 million in New Annual Recurring Revenue (“new ARR”), compared with €1.67 million in Q4 2021; a +22% increase. The total value of these new subscription contracts over their initial contract periods (excluding renewals and services) represents €6.88 million of Total Contract Value (“TCV”) in Q4 2022 versus €4.15 million in Q4 2021; a +66% increase.
In Q4 2022, international orders represented 54% of all bookings, largely driven by North America (46% of total bookings).
To these SaaS bookings should be added €1.18 million of additional related services in Q4 2022 (implementation, configuration and training excluding recurring services) – compared with €0.81 million in Q4 2021, a +45% increase. As a reminder, almost all of these services will be invoiced within twelve months of their signing.
In total, the Annual Contract Value (“ACV”) of these bookings in Q4 2022 was €3.21 million compared with €2.48 million in Q4 2021 (excluding recurring services); a +29% increase.
Record bookings in 2022, with more than €10 million in Annual Contract Value
In 2022, Sidetrade generated €6.44 million in Annual Recurring Revenue (“ARR”) compared to €4.75 million in 2021; a +36% increase.
Bookings linked to services (implementation, configuration and training, excluding recurring services) also achieved robust growth, up from €2.81 million in 2021 to €3.84 million in 2022; a +37% increase. In total, and considering that almost all of these services will be invoiced over the next twelve months
(excluding recurring services which can be invoiced over several years), the 2022 fiscal year enables Sidetrade to add the equivalent of €10.28 million in Annual Contract Value (“ACV”) compared to €7.56 million for fiscal 2021; a +36% increase.
In addition to both record quarterly performances in 2022 (Q1 2022 is the all-time high for a quarter while Q4 2022 is the best Q4 in Sidetrade’s history), the increase in bookings is based on a continuous solid upward trend on a half-yearly basis, as illustrated by the double-digit half-year sequential growth (+12.4%) on average.
| SIDETRADE | H1 2021 (€m) |
H2 2021 (€m) |
H1 2022 (€m) |
H2 2022 (€m) |
Average half-year sequential change |
|---|---|---|---|---|---|
| New SaaS Subscriptions (ARR) |
2.14 | 2.62 | 3.04 | 3.41 | 12.4% |
North America has already exceeded expectations, becoming a robust growth driver with 51% of total bookings in 2022
In 2022, international orders represented 66% of all bookings, driven largely by the multiple commercial successes in the United States.
The first eighteen months of US business have seen Sidetrade’s North American bookings continue on a strong growth trajectory, already representing more than half the Group total (51%) on a full-year basis in 2022, which is significantly above the target set by Management of 33% by Q4 2022. Sidetrade’s commercial wins in preference over local competitors with major North American players such as DXC Technologies in Q1 2022 (see the press release issued on 02/21/2022), Insights Enterprise in Q2 2022 (see the press release issued on 09/06/2022) and HPE, signed in Q4 2022, have already positioned the Group as one of the US’s go-to Order-to-Cash partners.
On the one hand, this excellent commercial momentum demonstrates Sidetrade’s technological edge in Artificial Intelligence with recognition by Gartner® as one of three Leaders for Integrated Invoice-to-Cash Applications in its 2022 Magic Quadrant publication (see the press release issued on 04/11/2022). On the other, it recognizes Sidetrade’s boldness to invest substantially and methodically in an experienced Order-to-Cash salesforce which will continue its ramp-up in the quarters ahead.
Sidetrade now has a workforce of close to 300 employees, with over 60% of its teams based outside of France, including 53 North American colleagues. Only eighteen months after its US operations were officially launched, Sidetrade has a salesforce that includes three experienced VP Sales Executives and 11 Enterprise Account Sales Managers all over the country, supported by three presales and a Chief Marketing Officer now located in the US. To ensure this salesforce is fully equipped to quickly penetrate the North American market in 2023, Sidetrade made additions by hiring a team of 11 sales lead generation experts on October 1, 2022, who work from the Group’s North American Business Hub opened in Calgary, Canada (see the press release issued on 10/04/2022).
| SIDETRADE (ARR) |
2021 (€m) |
2022 (€m) |
Change |
|---|---|---|---|
|
New SaaS Subscriptions |
4.75 | 6.44 | 36% |
|
of which North America |
1.04 | 3.27 | 214% |
The total value of these new subscription contracts over their initial contract periods (excluding renewals and services) reached a peak of €20.7 million of Total Contract Value (“TCV”) for the first time in 2022 versus €12.9 million in 2021, a dramatic increase of +60%. In particular, this surge is attributed to an extension of the initial contract period for new customers (excluding renewals), up from 36.2 to 44.9 months, thereby increasing the economic model’s high predictability.
Overall, in FY 2022, bookings by new customers (“New Business”) and Cross-selling represented 80% of the total versus 72% in FY 2021, with the remaining 20% of bookings accounting for Upselling of additional modules to existing customers compared to 28% in FY 2021.
Lastly, attrition remains under control for enterprise accounts with a churn rate of 3.83% as of December 31, 2022, which represents an excellent result for the SaaS industry, whose average was 14% according to the “2022 Private SaaS Company Survey Results” by KeyBank Capital Markets.
It should be noted that as with all existing contracts, the new contracts include an annual automatic price re-indexation clause based on changes in price indices for the relevant country.
In an inflationary market environment, now more than ever, businesses must deploy efficient solutions to manage their Order-to-Cash process as they face a twofold challenge: to consolidate cash reserves with multiple hikes in interest rates, while generating productivity gains to address salary increases and recruitment difficulties.
This trend is expected to continue over the next 12 to 18 months with an additional increased risk of future recession in certain countries. In this disrupted context, the management of operating working capital, and particularly accounts receivable, is a major challenge for all finance departments.
Strong increase in Order-to-Cash SaaS revenue: +22%
Revenue driven by international orders, up +13%
| SIDETRADE | Q4 2022 (€m) |
Q4 2021 (€m) |
Change | 2022 (€m) |
2021 (€m) |
Change |
|---|---|---|---|---|---|---|
| ‘Order-to-Cash’ Activities | 9.5 | 7.9 | +21% | 35.9 | 30.3 | +18% |
| of which SaaS Subscriptions | 8.1 | 6.4 | +25% | 30.1 | 24.7 | +22% |
| ‘Sales & Marketing’ Activities | 0.2 | 0.4 | -44% | 0.9 | 2.3 | -61% |
| revenue | 9.7 | 8.3 | +17% | 36.8 | 32.6 | +13% |
Sidetrade capped off 2022 with outstanding growth and a record fourth-quarter performance, reflecting a year full of successes as well as an important step taken in its development.
Q4 2022 ‘Order-to-Cash’ Activities totaled €9.5 million, up 21% on the same period in 2021 and driven by sharp growth in SaaS subscriptions (+25%) compared with Q4 2021.
On a full-year basis, ‘Order-to-Cash’ Activities for 2022 increased by 18%, thanks to strong growth in SaaS subscriptions (+22%). The increase in this recurring revenue is the result of record bookings in the 2021 fiscal year and early fiscal 2022, which continued to impact revenue growth throughout the 2022 fiscal year.
‘Order-to-Cash’ Activities, a core business within the Company’s strategy since 2019, represented 98% of total revenue in 2022.
The ‘Sales & Marketing’ Activities, which are no longer part of the Company’s strategy, now account for only 2% of total revenue in 2022, and will continue to decline, with estimated revenue of €0.5 million at end-2023. While the decline in revenue for these Activities impacted growth by 4% in 2022, it will automatically have considerably less impact in 2023.
Total revenue grew further by +13% in FY 2022, to €36.8 million. This performance is underpinned by vigorous growth in international markets which, for the first time in the Group’s history, represent 54% of total revenue, including 24% for North America.
Sidetrade’s economic model provides its business with significant resilience, as 90% of its revenue is recurring, representing a significant advantage in the current and future international environment.
All multi-year contracts are indexed to inflation (the Syntec for Southern Europe, the UK CPI for Northern Europe and the US CPI for the United States), which alters the total price of SaaS subscriptions each year by reference to changes in these price indices.
Sidetrade therefore has robust pricing power that protects the Company’s future revenue against uncertainties and inflationary pressures. At present, Sidetrade perfectly combines its sound fundamentals with a highly favorable growth outlook.
In respect of fiscal 2022, the impact of exchange rates on the Company was not material.