Communications service-provider Pinnacle Technology Group unveiled two takeover deals yesterday alongside deepening underlying losses and management changes including the departure of the chief executive.
Pinnacle Technology’s underlying losses widened to £572,000 from £512,000 in the year to end-September 2015. Revenues reached £7.9m, down from £8.4m, with the firm attributing the drop to “poorer trading on traditional telecommunications services and IT security”.
It also said recurring and renewable revenues “remain high” at 85 per cent, “providing a strong base for the company”, which is now run by executive chairman Gavin Lyons, who was appointed last month.
In further management upheaval, Pinnacle revealed yesterday that chief executive Nicholas Scallan is to leave in April after two years at the helm. Ian Winn, a former colleague of Lyons at IT firm Accumuli, is to become the company’s chief operating officer and finance director.
The company, which has its Scottish operational base in Glasgow, said the year was one of “significant transition” as it cut operational costs and sought to address “legacy issues”.
Pinnacle also revealed its proposed acquisitions of IT support business Ancar B, and The Weston Group, an IT, telecoms, mobile and CCTV specialist, for a total net outlay of £5m.
Non-executive director and former chairman James Dodd said these put the business “in a much better position to push on and take advantage of the market opportunity that exists, namely providing IT as a service to SMEs”.
The company said the deals are “a good strategic fit for the business” and it also flagged its exclusive digital partnership with mobile telecoms giant O2, announced in October, as “another highlight”.
It also noted that AIM-quoted merchant bank MXC is now taking a 25 per cent stake in the business “alongside major investment in Pinnacle from other institutions”.
Dodd added: “Operationally we continued to expend considerable effort in reducing costs and resolving legacy issues.”