LONDON, UK: Oxford Metrics plc has acquired Contemplas GmbH, specialists in video-based movement analysis, for an initial and deferred consideration of £1.14m (€1.32m), funded from existing cash resources, a news release said.
Commenting on the acquisition, Nick Bolton, CEO of Oxford Metrics, said: “Having firmly outlined our M&A intentions, I am delighted to welcome CONTEMPLAS to the Oxford Metrics family. Our strategy for Vicon is to strengthen and grow a profitable market leader; with the need for quick, reliable video analysis greater than ever, this acquisition is a good strategic fit, supporting our ‘amplify the core’ strategy, providing an opportunity to further diversify our leadership position in motion measurement and grow a recurring revenue stream inside our Vicon business.
As motion measurement continues to enter the everyday, we continue to see a broader range of applications emerging. Today with CONTEMPLAS – already well-respected leaders in their field of video-based motion measurement – we’re adding another new way to accurately measure motion, broadening our growing range of applications across even more use cases, such as a swimming race or sprint start, amplifying our existing capabilities, consolidating our leading market position as well as expanding our addressable market.”
Acquisition Highlights
This complementary acquisition is a strong strategic fit, consistent with Oxford Metrics’ strategic focus to ‘amplify the core’. The rationale is clear with CONTEMPLAS bringing a number of attributes to the Group, including:
| · | Amplifying the core of what we do – our strategy for Vicon is to strengthen and grow a profitable market leader. CONTEMPLAS reinforces Vicon’s technology leadership, adding video-based movement analysis to our offering. |
| · | Strength in niche markets, including a dominant position in swimming which opens up a new addressable market. The need for markerless measurement for quick use cases such as a swimming race or sprint start analysis is on the rise, providing the Group with growth opportunities to explore. |
| · | Strengthening Vicon’s presence in Europe with opportunities to benefit from Vicon’s existing infrastructure to expand into new geographical markets. |
| · | Bringing a customer base with different technical and use case requirements – CONTEMPLAS customers demand a more accessible price point and a different level of precision, bringing further diversification to our offering. |
| · | Complementing Vicon’s strong heritage and leadership position in motion measurement at a time when the need for reliable video analysis is greater than ever. CONTEMPLAS brings valuable IP which over time, will assist with Vicon’s product development plans. |
| · | Increasing the quality and recurring nature of Vicon revenue – as a Group we are focused on increasing the visibility of revenues and profits with a focus on Annual Recurring Revenue. CONTEMPLAS adds approximately £200K in ARR to Group revenues. |
Our strategy and strong financial position enable the Group to drive our software into yet more applications, amplifying the core of what we do. We will continue to invest organically to drive growth as well as exploring acquisition opportunities which can accelerate our strategies in our chosen markets.
CONTEMPLAS brings a great video product and differentiated capabilities
Founded in 2005 in Kempten, Germany, CONTEMPLAS is one of the leading providers in the field of video-based movement analysis, developing and distributing worldwide software solutions for general motion analysis. CONTEMPLAS Templo software can record and track motion across a range of activities including walking, running, sprinting and swimming among many others, whether in training or in competition.
CONTEMPLAS will be integrated into the Group’s Vicon division and has been acquired from its founders Stefan Klippel and Thomas Seeholzer who will continue to run day-to-day operations, bringing over 25 years of experience in motion analysis and know-how in hardware technology.
14 employees in total will be transferring to Vicon adding over 4,000 licences and over 3,500 customers worldwide including Olympic training centres and, NHL and NFL teams. In swimming its customers include Aberdeen Sports Village, focused on high performance swimming, and the Malaysia Diving Team, who are world leaders in diving. CONTEMPLAS has also worked with FINA, the International Swimming Federation, at various world events.
CONTEMPLAS’ Templo motion analysis software measures a wide variety of applications and provides 2D and 3D insights using the latest video technology and sophisticated image processing. The addition of CONTEMPLAS will also give existing Vicon customers more choice on how they measure motion with enhanced video-based analysis options, providing accurate motion measurement across even more use cases such as in-store running analysis or jumping analysis, providing the Group with growth opportunities to explore.
In sports the video analysis is used to analyse swimming, running, starting, jumping, balance and agility and in health to analyse clinical gait, posture and ergonomics. CONTEMPLAS is also currently developing a cloud-based video analytics solution which will over time create a valuable recurring revenue stream.
Terms of the acquisition
Prior to the acquisition the Group held a 12% interest following an investment of €0.1m in 2005. The acquisition announced today acquires the remaining 88% based on an Enterprise Value of €1.82m. The deal consists of:
– initial consideration of £0.92m (€1.07m) paid in cash from existing resources.
– deferred cash consideration of £0.22m (€0.25m) payable no later than 48 months post acquisition.
– contingent cash consideration of up to £2.06m (€2.40m), 90% of which is subject to CONTEMPLAS achieving a series of SaaS-based recurring revenue goals measured over 45 months and 10% of which is contingent on growth of existing revenue streams measured over 36 months. Payments will be made on the achievement of certain revenue and ARR milestones during the earnout period.
The trading performance for the year ended 31 December 2020 recorded revenues of €1.63m and an EBITDA of €0.16m.
Oxford Metrics expects the acquisition to be earnings accretive in FY22 and beyond. Assuming the achievement of revenue goals during the earn-out period the acquisition is expected to make a meaningful contribution to Group profitability in FY23 and become increasingly earnings enhancing in subsequent financial years.
Oxford Metrics PLC share price
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31 Aug, 4:30 pm GMT+1 ·Disclaimer
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