Iomart on cloud nine as sales push through £100m

Chief executive Angus MacSween says Iomart has delivered yet another year of growth. Picture: Contributed
Chief executive Angus MacSween says Iomart has delivered yet another year of growth. Picture: Contributed
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Iomart, the Glasgow-based cloud computing and web hosting company, is on track to deliver another year of solid sales growth alongside “consistent, strong profitability and cash generation”.

In a pre-close trading update, the group said that it expects to report annual revenues of about £104 million, which would be comfortably ahead of the previous year’s £97.7m.

Adjusted underlying earnings for the year to 31 March are set to top £42.2m, up from £39.8, while adjusted profit before tax was flagged at £25.3m, up from £24m.

The firm, which is quoted on London’s Alternative Investment Market, said that over the past 12 months it had “reinvigorated” its sales and marketing function.

“The early benefits of this effort started to flow through in the second half of the financial year with an increase in new lead generation from both new and existing customers,” it noted. “This has delivered a strong finish to the year with a significantly larger pipeline of prospects than this time last year and we enter the new financial year with confidence.”

The group told investors that the adoption of cloud computing services by businesses and organisations remained a “long term trend” and, as a result, its market opportunity was “large and widening”.

Chief executive Angus MacSween said: “Iomart has delivered yet another year of growth with strong profitability and cash flow underpinned by our recurring revenue business model, diverse customer base and attractive market position.

“The group’s large and building sales pipeline, combined with high levels of visibility and a significant market opportunity, leaves the board very confident in the outlook for the new financial year, as well as the long term prospects for the group.”

Recapping its second-half investments, Iomart said it had completed the acquisition of LDeX Group for an initial sum of £7.5m, with a further maximum contingent consideration of £3.5m. LDeX provides data centre and connectivity services in the UK from central London and Manchester locations.

Meanwhile, the group purchased the freehold interest in its Maidenhead site for £5.4m. “This investment, along with the extension of our London lease earlier in the year, and the LDeX acquisition, brings long-term certainty to our data centre infrastructure,” Iomart added.

The group expects to report its results for the year to 31 March on 11 June.

In December, the firm reported revenue growth of 8 per cent to £50.9m for the half-year ending 30 September, a figure it strongly anticipated would rise to £100m for the full-year.

Profit before tax was £12.4m, up 7 per cent year-on-year.