SysGroup seeing benefits of bolt-ons and is confident on full year progress
Liverpool-based Cloud hosting provider, SysGroup, enjoyed an improved first half performance, a trading update for the period to September 30, revealed today.
The AIM-listed business, which will publish its interim figures on on November 21, said it is pleased with a strong trading performance, despite the challenging macro-economic environment.
SysGroup made the successful acquisitions of Truststream and Orchard earlier this year and the integration of both are progressing well.
The board said it is pleased with the performance of both companies to date and is already seeing early signs of the potential benefits of the cross-sell opportunities.
As such, the group expects to report revenue for the first half of fiscal year 2023 of £11.32m, which compares with £7.58m for 2022, and adjusted EBITDA of £1.67m, up from £1.34m a year ago, both of which are in line with current market expectations.
Further, the group also finished the half year with a healthy gross cash balance of £4.22m, an improvement on last year’s £3.47m figure, and a net debt position of £1.92m, compared with net cash of £1.96m in 2022, excluding contingent consideration of £3.08m relating to the acquisition of Truststream.
SysGroup has maintained its trading momentum with its sales pipeline continuing to grow and the investment made in fiscal year 2022 in to its new Manchester sales and marketing hub is starting to materialise.
It said while there is still progress to be made, the team is now at full complement and is making good progress.
The company added that the need for managed IT services remains prevalent and as businesses increasingly seek to invest in technology to increase efficiencies and improve their margins, SysGroup is ideally placed to capitalise on this growing market opportunity.
The board reiterated it is fully committed to SysGroup’s business model and remains confident that the group will meet market expectations for the full financial year.
Chief executive, Adam Binks, said: “I am pleased with the progress that we have made in H1 FY23. To have delivered a revenue and Adjusted EBITDA performance in line with current market expectations, despite the numerous macro-economic challenges, is testament to the resilience of our strategy and hard work of our team.
“The benefits of the recent Truststream and Orchard acquisitions are already clear and the enlarged customer base is fully engaged in understanding what additional support we can provide from our enhanced service offering.
“I remain grateful for the continued commitment of our teams, who continue to drive the group forward and support our customers at an increasingly important time.”
