Software group Sanderson cheered by new sales success
SPECIALIST software firm Sanderson Group has told the market it expects its interim results to be in line with expectations, although it continues to look for potential growth opportunities.
The Coventry-based firm, which supplies software and IT services to the digital retail and manufacturing sectors, said it was benefiting from a strong order book.
In a trading update, the firm said revenue would show growth to just below £10m, compared with £9m and operating profit would be just under £1.5m compared with £1.37m in the equivalent period last year.
Sales order intake was over £6m (H1 2015: £4.94m) and included over £2m of business gained from new customers, exceeding the total value of business gained from new customers during the whole of the financial year ended September 30, 2015.
Reflecting this sales success, the group’s order book at March 31, 2016 stood at £3.20m (H1 2015: £2.84m), whilst pre-contracted recurring revenues continued to grow and now represent 53% of total revenue. The net cash balance at March 31, 2016 was £3.39m, reflecting strong cash generation and included the payment of the final deferred consideration of £1.54 million in respect of 2013 and 2014 acquisitions.
The Sanderson Digital Retail businesses, which operate in very active and rapidly developing markets, continued to make progress. Digital Retail grew revenue in the period, although short-term profitability in the six month period was affected by the planned further investment in management, sales and delivery capacity in anticipation of continued rapid growth in the digital retail market. Sales prospects remain good and notwithstanding some current nervousness in the retail sector, a strong full year performance is expected.
“The group continues to seek complementary acquisitions and a number of opportunities are being developed. Management continue to adopt a careful and measured approach to acquisitions with the priority being very much focused on delivering shareholder value through continued growth and ‘on target’ results,” it said.
“The board remains cautious in its approach but a strong order book and healthy balance sheet, together with a good list of sales prospects, provides the board with confidence that the group will continue to make further progress and deliver trading results in line with market expectations for the current year ending September 30, 2016.”
