Q3 2025 Trading update

Alfa Financial Software Holdings PLC ("Alfa" or the "Company"), a leading developer of mission-critical software for the asset finance industry provides a scheduled update on trading for the third quarter ended 30 September 2025 ("Q3").

Strong trading

Revenue of £31.7m for Q3 was up 12% on the third quarter of last year, or 14% at constant currency. This was in line with our expectations.

Q3 financial highlights:

• Subscription revenues: continued strong growth, up 16% on Q3 2024
• Delivery revenues: up 26% versus Q3 2024, with our delivery teams busy across all three regions
• Software Engineering revenues: as expected, revenues were down 30% versus a strong Q3 last year. This was due to moving our focus to investment having completed the required customer development to achieve delivery milestones
• TCV ended the quarter at a record of £222m, up from £211m at 30 June 2025 and versus £205m at the end of Q3 last year

Our focus on tight cost control resulted in lower costs in the period than expected owing to a carefully managed expansion in headcount along with some underspend on travel, conferences and IT costs.

Robust pipeline & TCV

Our late-stage pipeline remains strong with a net increase in the number of prospects from seven to eight. We are the preferred supplier for seven of these and have commenced paid work under letters of engagement with five. Since announcing our half year results we have converted an Equipment OEM in Australia & New Zealand into a win. We have also added two new prospects, an Auto OEM covering a multi-country South American project and a UK high street bank.

Overall TCV showed a pleasing increase in Q3. Delivery TCV benefited from expanded work with existing customers and the conversion from the late-stage pipeline of the Equipment OEM noted above. Subscription TCV increased due to a two-year extension to a contract along with continued underlying growth in Subscription revenues. Software TCV was lower in the period reflecting the shift in our focus to investment having completed the required customer development to achieve delivery milestones.

We are pleased with the overall strength of the pipeline from early stage through to late stage and in all geographies.

Focused operational execution

In Q3 we completed 10 deliveries, including an Alfa Systems 6 go-live for an existing OEM customer in the Nordics, upgrading from v4. Immediately after the quarter end we also delivered a go-live in New Zealand, further demonstrating our success in working with customers across multiple territories.

Conversions to Alfa Systems 6 have continued both effectively and at pace. We now have 14 customers on Alfa Systems 6.

Progress on expanding markets

We have made good progress in developing our Originations and Fleet capabilities, which expands our Serviceable Addressable Market and also with Commercial Finance which expands our Total Addressable Market. We now have demonstrable software solutions for all three end-markets and we are further encouraged by feedback received during the industry conferences we have attended over the last two months.

Outlook

We have increased our operating margin and profit expectations for the full year by c.£2m. Our revenue expectations for the year to December 2025 remain unchanged. Our cost discipline driving the underspend on costs in Q3 is expected to continue through Q4. We now expect costs for the full year to be c.£2m less than previously estimated, thereby increasing our operating margin and profit expectations for the full year accordingly.

Andrew Denton, Chief Executive Officer

"We are very pleased with our third quarter performance and I am delighted that we are able to increase our expectations for the full year. Alongside delivering this strong financial performance we have also continued to invest in our product and our people to enhance our leading position in the market. We remain confident in the strength of our pipeline and the future prospects for the business."