Welcome to the ActiveOps half year interim update, and as ever, very pleased with your time in the next hour. I'd like to take you through the key highlights. Let me begin, as usual, with a short introduction, for those of you who may not have come across ActiveOps, about the company and what we do and the value we add. Before I hand over to Emma to talk through the key finances. Then I'll pick up on with the stretching out a little bit at the back end. ActiveOps is a decision intelligence and enterprise software platform we deliver through SaaS to our global client base, primarily in the financial services and related sectors, insurances and BPO.
We have three products delivering decision intelligence, which enables what we do, is we enable organizations to effectively optimize their capacity and work across highly diverse, highly complex organizations. Right now, given the realities of hybrid working, as you might imagine, and I'll come back to this, just the challenges of doing that really, really well are only increasing for the customer type, and as such, the value of ActiveOps is growing. You can see on the screen there our regional distribution, across the number of regions we operate, so on Australia, Asia Pacific, EMEA and North America, but also our revenue split is primarily SaaS-based delivery, which I'm going to talk more about, with some services related in support and installation. In terms of the key strength of the business, what we have is a situation where this is a market which is growing significantly.
The sense of awareness of this need for better data, better decision intelligence, to optimize and to manage capacity is only growing. I think the recent sort of hybrid working and the consequence of people not knowing if their people are performing at work or at home, better, is just really causing a lot of recognition of the need for better data. ActiveOps has a specialism. We are experts in this field, so our knowledge is nowhere else in the world and no organization in the world that focused as exclusively on this particular problem. With the combination of technology I'm coming to and our inherent sort of expertise in this area, we've got some really differentiated offerings coming to the fore in terms of solving some really quite difficult problems in some new ways. We have been in this game quite a long time.
We have an excellent blue chip customer base, which you can see some of the logos along the bottom there, but that also means a track record, that some of our customers have been with us since 2002, 2003, and continue to drive and add value to our software. Related, I think, it's a global market, but it's also very, very much untapped. I mean, we've got some sums, which we'll talk about in terms of the expansion within our existing customer base. I think beyond that, as the need becomes stronger and the value becomes clearer, the actual addressable market is growing to a very large level. It's a fast business model, means annual advance based on the headcount under management, and so it's a very robust business model.
We generate cash, high gross margins, as such, growth is funded by our own activities rather than drawing new capital. It's a very, very scalable business. In particular, and I'll come more to this, one of the great things for us and why I'm very upbeat about the business, is you'll see in the figures, we're able now to start really layering in some expansion costs in terms of sales heads, and we still keep ourselves in terms of profitability on the right side of the wire. We are well down the track of some significant expansion in the business. There's an awful lot to be really excited about. If I look at just sort of help those of you who may not have come across this before, just a little, a little sort of vignette or case study here.
Fidelity International, been on our stage many times now, but talking about their particular journey. Key things here is the way in which it's been plumbed into their whole way they manage work. They use Workday as an HCM system. They have a variety of delivery systems consolidated through something called Snowflake as an intermediary, and that all draws data, which ActiveOps now sums that together to present and help them manage and control their workforce. You can see some quotes on the screen there about how they do that and more importantly, the impact it's had. The top right-hand side shows the very classic sort of ActiveOps style, land and expand. People introduce ActiveOps as a method, impact an area, find the potency of it, and then we effectively expand across the rest of the user base. We'll return to that theme.
The great thing about this particular customer is they also very much, if you like, on the cutting edge of using our tool to leverage their own AI strategy. The ability not only to deploy AI in terms of the execution processes, but they're very excited about the ActiveOps technology to really impact on middle management and the effectiveness and the sort of the cost of the business in terms of managing layers of having ActiveOps on board. Again, I'll come back to that. Now, turning to our immediate past year, I think the highlights which we are calling out in this briefing, reflecting that sort of general market vibe, we've had three new customer wins in the course of the year, two of which have really got significant expansion possibilities.
One's a relatively small organization, which we are going straight in and essentially fully using our software. We're seeing some really good regional activity, so we're calling out the Canadian market particularly, but South Africa is very energetic. Also, Australia and AP, which has been a real cornerstone business for many years, but it's in some sense been quite flat for the last few years. The new technologies and the energizing impact it has on customers there in terms of their appetite for new functionality and therefore higher price raises, is also very, very encouraging. We'll talk more about the average price rise we've seen through the series, but it's really picking up. Part of our technology, we've been in the process of replacing our underlying SaaS software with the next generation, and that really is done. I mean, that's a huge result.
It's a hidden cost on the business in terms of a break to get customers to pay more. That is completed in the course of the last half year. With in terms of the ControliQ uplift, although we've only got 8% of the customers on it, the uplift value is great, and, you know, have taken up seriously so far. The impact on our revenues future is, in terms of value, is very strongly. I'll come back to the innovation and investment. There's lots of things to talk about in terms of the platform, because of that upgrade, what we can now do.
I think also the key message for this is how we have now already taken on this a further five sales heads, which as in the way of enterprise selling with the lag involved, creates the foundation for a lot of very interesting growth in the course of the 12-18 month horizon. Probably more for me, strategically, we can take on as many as we can, as in as we need to, because the business capitalization is well capitalized. If you know, we have that sort of labor that really responds to the market, the capacity for further growth is right there, whether it's by region or across the enterprise. That's the key highlights. I think that just for a change of voice, I'll hand over to Emma to take you on to the financials.
Perfect. Thank you, Richard. Okay, firstly, I'm just gonna talk you through the high level commercial model that we have here at ActiveOps. Our revenue comes from two revenue streams. We've got SaaS revenue and training and implementation revenue. The mix between SaaS revenue and implementation revenue broadly stays the same. Around 90% of our total revenue comes from SaaS and then 10% comes from implementation services. Our SaaS contracts are typically one year in length, and they are charged on a per seat basis. Typically, they are charged annually in advance and then recognized over the term of the contract, as you would expect with any other SaaS business. The training and implementation revenues can fluctuate slightly year on year. The main driver behind that is the product mix.
Our ControliQ and WorkiQ products take around 12 weeks to install, versus WorkiQ, which can take three weeks to install. The prices and point for this does vary depending on the product and also the location in which we are installing. However, we do still deliver strong margins, so the margins on training and implementation can range between 50% and 55%. It is also worth noting the SaaS margin. We deliver strong SaaS margins as well, and for the first half of this financial year, we delivered a SaaS margin of 88%. In terms of the highlights for H1 for FY25, we delivered another set of healthy results for the first half of the year, with total revenues at GBP 14.3 million, delivering a double-digit growth year-on-year on a constant currency basis.
In year end 2024, we delivered our amazing year on profitability with a PBT position. We have seen a continuation of this momentum build, which talks to just this EBITDA margin. The EBITDA margin for the first half of the last financial year was 6% versus this year, which is 7%. That's despite an investment in sales capacity, which we have gone through during the first half of the year, which I'll come to in a moment. In terms of cash in the bank, we sat with GBP 13.4 million in the bank at the end of the first half of the year. Half-year on half-year, that has seen an increase of 36% year-on-year.
In terms of the free cash flow, we've seen an improvement in the free cash flow outflow, which we would typically see in the first half of the year as well. Alongside the robust standard P&L performance, the other thing to highlight really is the EPS score. The EPS for last year was a loss of GBP 0.14 per share, versus this year at a profit of GBP 0.52 per share, which again talks to the momentum building and the profitability of the business, and despite the extra investment, which we'll come on to in a second. In terms of the EBITDA bridge and the movement half year on half year, two really significant ones to point out here is the sales and marketing investment.
We've had an increase of half a million pounds of sales spend during the year, which talks to the onboarding of five new sales executives. We started the financial year with what we would class as eight quota carriers, and during the first half year, we onboarded five, so we've now got 13. This talks very much to over the last few years, we've heavily invested in the product development with the replatforming three years ago, and then also the release of Series 3.0 and the release of Series 4.0, which is coming by the end of this financial year. Then also the go to market. In the last few years we've very much focused on the marketing aspect of that. The onboarding of the new chief marketing officer and then just an increase in spend in marketing.
What we felt is we are at the pivotal point in this journey of the business to start to invest in the sales capacity, hence why we've onboarded five new executives, which we'll come to in a little bit more detail around their bios and experiences shortly. The other thing I just really want to highlight on here is the capitalization of labor. If you look on the slide, we have seen a reduction in the capitalization of labor for the first half of the year. This isn't a signal that we have reduced the spend of R&D. This is purely around what we have spent time on during the first half of the year, what we could capitalize and what we couldn't under accounting standards. That isn't an indicator or anything like that. We are continuing to invest in this space.
If we talk around the underlying strength of our ActiveOps model, the ARR half year on half year increase is 12%, double digits on a constant currency basis. We've consistently delivered a strong NRR position of around 110% for a number of years, which we've also delivered for the first half of the year on a constant currency basis. It is worth noting, and we have highlighted it in the RNS this morning, that we have received notification from one of our customers that they plan to reduce their user base. They are a very significant customer to us, however, we've not lost the logo. It is purely a reduction of their users. They will still remain in our top 10 on the customer chart.
The main driver behind that is with the new leadership in this particular area, the workforce management team have transitioned in this particular customer, and their call center software provider essentially offered to provide a solution for their back office solution as well, essentially free of charge. When this balances up against the cost freeze from their perspective, they've decided to reduce the user basis for ActiveOps. Whilst this will be a growth impact on our ARR of 5%, I want to reassure everybody that we are still expecting our net revenue retention to exceed 100% by the end of the financial year. Whilst it's frustrating, there isn't an underlying issue with us now achieving the board expectations on the full year numbers.
In terms of the land and expand success, this is something that we talked about in quite a lot of detail. One of the things that we're showing here on this middle chart is the acceleration in our land and expand success. For the first part of this financial year, 87% of our customers have increased or maintained their ARR. Actually, what's more impressive is that 31% have actually increased their ARR by 20% or more. We still continue to see a good improvement in growth within CaseworkiQ, we're seeing an over a 20% half-year-on-half-year growth of CaseworkiQ as we continue to cross-sell that within the existing customer base.
Also with the launch of Series 3.0 at the back end of last year, we're seeing some really good momentum build on customers cross-selling to Series 3.0. We have done here is for those of you who joined the presentation at the end of the financial year 2024, we showed you a case study of a U.K. Tier One bank and the expansion journey that we've been on with that customer over the last eight years. We are seeing really good success at the moment in the Australian market. We've got a number of large banks in Australia who have now also upsold to Series 3.0. We thought we'd give Australia a bit of some of the light for this particular presentation. What's actually really interesting about this customer, they've actually been a customer with us since the early 2000s.
We've just shown you the journey since FY17. From FY17 to FY22, they went through the typical expansion journey that is very typical for us, that we see within our customer base, where we more than doubled the ARR. Across FY23 and FY24, we went through an RFP process. This is one of the customers where we won the announced RFP last year, and as part of this RFP process, we actually upsold them to Series 3.0. What you can see here is an uplift in ARR of 23%. Now, where this series is really helping us is to build some momentum in the growth of the ARR. It's given us an opportunity with some of the legacy customers that may have been on a slightly lower price point.
It's given us an opportunity to level up and rebase some of that pricing, which you can see come through here in this particular customer. I'm going to see a little bit of what Richard is going to talk to you about shortly, which is our TAM. One of the TAM statistics that we share is TAM within our existing accounts. We currently quantify that to be around GBP 90 million of ARR. What we've done here is just break that down to sort of give some color as to where the GBP 90 million ARR TAM comes from within the existing customer base. We've talked a lot about the success of the Series 3.0.
What's really exciting is at the moment, 20% of customers have moved up to Series 3.0. Actually, we've already, at the end of September, we had another 8% of our customers who are already contracted to move to Series 3.0 during H2 of this financial year. That shows you there's another 72% of customers where we believe that actually moving up to Series 3.0 would be appropriate for them and gives us a big opportunity to upsell in those particular accounts. The same with CaseworkiQ. Twenty percent of ControliQ customers are using CaseworkiQ, which gives us an estimate of 45 existing accounts, which we have identified as candidates for CaseworkiQ, and which gives us an opportunity to cross-sell in those areas.
What's also really exciting on top of all of this, is we've got Series 4 being launched at the end of this financial year, which will give us an opportunity to push a further upsell even with the customers that have moved to Series 3. We've actually already had 2 customers who've contracted to go to Series 4, and one of those is a new logo, which we secured post the half year position, which will feed into H2 and also an existing customer. To summarize, that's an existing customer and a new logo who have already contracted Series 4. As soon as that releases, they will transition to Series 4, which is really positive and is already showing the momentum that we are already building with Series 4 as well. Just to finish off the finance section.
The business, as we have done for many years, we remain in a very healthy position. We've got no debt on the balance sheet. We've got high levels of cash across the full financial year. When you take in the seasonality of cash collections, we generate cash and lots of it. A high level of our revenue is recurring. 90% of our total revenue is recurring revenue. As I mentioned before, we're really starting to see the momentum building and profitability in the business, and then also with the opportunities to cross-sell and upsell, even just within the existing, is really exciting, especially when you start to compound that into new logo acquisition, which is one of the reasons as to why we've invested into the sales team that we have so far this year.
Very good. Thanks, Emma. Picking up on some of the themes that we've been talking about, just to set in the context for our solution, if you like. As I've alluded to already, a lot of organizations are only really beginning to appreciate just how many different factors are moving in terms of their, the solutions available to them, in terms of improving the customer experience, the staff engagement, and all the other kind of elements that turn what they offer into a real product for customers. The complexity is escalating, whether it's through the opportunities through AI, but the cashing the check, the underlying complexity of moving legacy systems, and so on. I've been working on the resourcing side.
The problem with managing ops, let's say, if you're a large enterprise, against the greenfields and the startups, is only getting more complicated. Not necessarily harder, but it's just to take advantage of the opportunities they're presenting, they've just got to get stronger. That is undoubtedly impacting on the interest in ActiveOps, because people are beginning to appreciate, organizations really are appreciating that it's not just, if you like, the check for the system, the RPA system or the automation platform. It's their capacity to execute, to really drive the value that has, let's say, not been a signature of success in the past, and they need to pay more attention to that.
ActiveOps, with our particular specialism, as I alluded to, we are experts in this field. This is something we've worked on for many, many years. That gives us a number of assets. Firstly, we have a framework through which people can manage that problem. You know, we have our underlying methodology, which is a standard across the plan. That's hugely important when you have to have AI tools that need to know what good looks like to be able to be trained. Also, in itself, it's an area of opportunity for organizations. Most focus around technology tends to be on the execution process. In truth, whether it's the regulatory controls, whether it's the execution controls, the management layer in organizations is a very significant cost driver in its own right.
If we can impact on that, both make it more effective and reduce the effort involved, that has a huge compounding effect for our type of customers in terms of their cost-income ratios. ActiveOps has a solution which is incredibly relevant and actually is well positioned to exploit that, because we have a kind of formula in areas where typically people don't have a playbook or a structure for that. The next slide, I think, is incredibly impactful in terms of just the journey that ActiveOps has been on. This is just a timeline of our kind of significant functional deployments over the years, and you can just see over as we get towards this current date, that impact of our re-platform.
The technologies, there's a list on the top right there, that will be embedded in release 4, which is Series 4.0, is just another step on in terms of the function enhancement. We're now working to manage working capacity across an entire enterprise. We've got projects running in South Africa, which is really interesting, where we're gonna be looking at the work back in branches, in the relationship management channels, in the digital channels, and the back office and contact center. That has to be summarized and brought together so that executives can really see, probably for the first time, the impact and flows of that aggregated work as they, as they move work and they implement change across channels. The consequence of that managed business planning, I can convert those activities into scenarios and really work that through.
These are all things that typically people can use ActiveOps data. It might have exported to planning systems that we now inherently support. Our own copilot, our AI-driven support for team managers is called Opi. That is again, all about helping you and I, as operational leaders, do the right thing more often. It's supporting us with information pertaining to, you know, time for the appraisal for Richard this week. This is the information that would probably help you have that discussion with him. These are the areas of his skills which are really good. These are the areas that if he was cross-trained, he'd be even better. Things that would have relied on the knowledge of the individual suddenly being surfaced in a systemic way. Again, impact on effectiveness and efficiency of managerial time.
I could go on, but the key point of this slide is just to show you that kind of galvanizing impact on ActiveOps with technology and to our ability to bring value to customers. Which is very important because it gives us the kind of dog whistle of things that we can do that genuinely are quite innovative, that gets you the attention and the prioritization in that sort of enterprise technology stack debate about what you do first and so on through. Some of the sort of manifestations of that, you'll see we've recently had a very successful conference season in London. I think we had 100% more people attend this year than we had the previous year, and we just went through some of the stuff going on. This is just smart skills, which is gonna be revolutionary.
Cataloging what people are good at inside organizations is imperfect, totally manual, and relies on the knowledge of the local person involved in managing a team. ActiveOps blows that away. Now, skills, your confidence and capability are really at granular level, is determined by the software. We know what the learning curves are. We can flag whether people are slow learners, fast learners, contributions, and so on. Just the capacity of this data links immediately into things like Workday, SuccessFactors, the value to HR of having ActiveOps. That speaks to the current event that we've talked about here and our response to that. Increasingly, what we're making sure is ActiveOps' dependency on our data, rather, is much more broad effect. We have the HR department needing the skills data.
We have the finance department needing the cost and resource data, as well as ops people having the resources and then having the use of the tool to derive that. That's our fundamental strategy for stickiness. Let's make ActiveOps the source of it, of, you know, source of single source of truth, but not just in the ops domain, it's across the estate. Sticking to the marketing activity behind the technology refresh, we're really seeing that coming through. You can see on our website a change in our kind of tone and measurement, but behind that is a whole load of targeting strategies to the top 250 customers we want to speak with. That is driving a different sort of inbound inquiry, where people are now coming to us with a need that they think they...
They've already seen our stuff and think that we can meet that need. That joins up with bringing us in our new enterprise salespeople, which I talked to, who are more about those software sales. They have to have people, and they need to have power. Those customers who have some sense of need, it's not an education challenge, but they need to help them move through the process to buy. We're seeing sort of quite a shift in, in tone of the sales management process on the back of this speed. Little bit more on that. We've spoken a bit about the sales, we've recruited three new salespeople in the U.K., combination of sales experience, but really focused on that sales of enterprise software.
In Canada, in particular, where we've seen this real uplift in ARR in the last couple of years, but more importantly, most of those customers, four out of five banks in Canada that use us, they're all at the early stage of explosion for ActiveOps. Nurturing and developing that capacity is really important to us. Effectively, we're breaking the North American market into two, really focusing on the Canadian market because it's a great opportunity. Lots of things still going on in the U.S., but the immediate, that kind of uplift in, in Canada is exciting. South Africa, there's some great things happening there. I've mentioned about some of the technical challenges, but also there is that, after their election, there's a much greater sort of confidence coming back into the market that...
There's also that socioeconomic need of lifting skills and ActiveOps' training and accreditation across that banking community for their junior and middle management is really resonating. Again, just local reasons, but business there. Australia as well. We recruited a senior leader down there last January, and I would say she has, in conjunction and behind the technology and the Series three and Series four opportunity, is really good from that business. Again, very optimistic about the outlook for Asia Pacific. Focusing then in on the target addressable, Emma has spoken to this, as she said, spoken somewhat under. I mean, we have an existing customer base, and it's driving about GBP 24 million with the ARR.
If you look at the impact of both the Series uplifts, the CaseworkiQ and the WorkiQ, and we've cut this several times in different ways, you absolutely can point out the direct opportunities that GBP 90 million ARR in those customer base. That would be, you know, for example, building on that Canadian story, for example, expanding our use case in Australia to further products. Similarly, in the healthcare market in the U.S., moving from WorkiQ to ControliQ. All of which adds up to a significant number of customers with whom we already have this contract. Looking more widely, if you look at this market sense of need, the frustration with poorly delivered technology and transformation changes being attributed to poor control, you look at the compelling arguments for AI, but we need to get it operationalized.
There's a whole series of things that says in our target customer base, they have a control challenge which we can meet. The issue for us is one of focus, because our time is not limited. The way we focus is to pick on those customers, the banks, insurance companies, and the business process outsourcers whom we know well. We know how to solve the problems, we speak their language in terms of the type of work they do, but more importantly, we know how to implement in the context of the reality, the complexity, the noise of that kind of controlled and regulated environment, which in itself is a real differentiation for ActiveOps. We think, again, the combination of product, marketing, and need is really quite interesting.
Looking to the trading outlook, the reduction in usage in one of our customers is a shame, because actually, I think we'd be much more sort of signaling a rise. However, the fundamentals of the business are coming through really well. We've already sold two new customers, one of whom is a major U.K. outsourcer, for whom it's been a long battle to get them to sort of see the need for ActiveOps, let's say, but the potential is huge. Another in Australia, a global healthcare provider, has taken ActiveOps over there, and that's got a lot of global expansion potential. As I've already alluded to, the Series four release, with its next generation of make the job of managing people really, really easy, I think has got huge, huge current appeal. We're really there. It's just now a sales execution challenge.
I say it's just, that capacity we've brought on board with the sales team, so really, that only arrived in September. Well, August, September, but I think we're very well placed to really start to see that sort of 12-month sales cycle kicking into extra signings over the coming sort of the 12-18 month timeline. ActiveOps as an enterprise in terms of our tech stack and our capacity, I think is very well placed, and we're really seeing that come through in terms of those new signings and the expansion opportunities.