Half-year revenues fall as pandemic continues to hit SysGroup
The continued impact of the pandemic has hit half-year revenues at SysGroup, the Merseyside IT managed services and cloud hosting provider.
Turnover for the six months ending 30 September 2021 has fallen from £9m in the prior year to £7.58m while adjusted pre-tax profits stood at £960,000, a slight reduction from £990,000 for the same period in 2020.
Recurring managed IT services revenue represented 86% of total revenue.
Sysgroup said the reduction in revenue was caused by the wider impact of COVID on the economy last year which saw companied defer spending decisions.
Some customers were forced to reduce their contracted services on renewal, either as a result of needing to save costs to manage their financial position or owing to the fact they had reduced their own staff numbers therefore requiring less resources, the group said.
In managed IT services SysGroup also experienced a higher than normal level of churn.
As a result, the group entered this financial year at a lower contracted income level than last year.
Adam Binks, chief executive, said: “Since the onset of the global pandemic we have focused on two key areas: firstly, supporting our customers, which our team have worked tirelessly to achieve, and which they have done with considerable success.
“Secondly, optimising all internal operations of our business to maximise our opportunity once economic certainty improves and trading conditions normalise. I am extremely pleased with how we have fared against both of these objectives.
“The timing of a wider recovery is outside of our control but we have a strong customer base with high levels of recurring revenue. We have a strong balance sheet with a very healthy cash balance which we expect to improve further in H2 as our capex requirements were H1 weighted.
“Our sales teams will be pushing even harder during the remainder of the year and looking to increase the face to face interactions which will see our pipeline of opportunity begin to convert in to sales. We are committed to our acquisition strategy but we will stick to our rigorous criteria and not be drawn into deals which would deliver sub-optimal returns.”
