Iomart announces robust results, appoints new chair

11th Jun 2024 16:54

(Sharecast News) - Cloud computing and managed services provider Iomart Group announced a robust set of financial results for the year ended 31 March on Tuesday, as well as the appointment of a new board chair.

The AIM-traded company's revenue grew 10% to a record £127m, up from £115.6m in the prior year, bolstered by two strategic acquisitions and organic growth within its cloud managed services sector.

It said that sector, now the largest component of the group, saw a 17% revenue increase to £75.2m.

The group's adjusted EBITDA margin was 29.7%, down slightly from 31.3% in the 2023 financial year, due to changes in revenue mix and specific inflationary price adjustments.

Despite a £1.4m rise in interest expenses due to increased bank rates, the adjusted profit before tax grew modestly by 1% to £15m.

Iomart's strong cash generation resulted in a cash conversion ratio of 97%.

Strategically, Iomart said it aimed to grow 'bigger, better, bolder'.

The company reported double-digit order bookings growth, completed the acquisitions of Extrinsica and Accesspoint, and was named a Broadcom Pinnacle Partner.

Organisational improvements included the integration of several acquisitions, new leadership appointments, and relocation to a new office in Glasgow.

Looking ahead, Iomart said it expected growth to be more second-half weighted in the 2025 financial year due to industry changes in VMware licensing and inflation-driven cost increases.

However, the board said it remained confident in the long-term prospects, driven by the increasing complexity of the technical landscape and demand for trusted service partners.

"I am delighted to report on a year of revenue growth supported by two acquisitions and organic growth within cloud managed services, the area which is the key focus of our commercial and product strategy," said chief executive officer Lucy Dimes.

"We delivered good profitability and continued strong cash generation, providing us with the strong financial foundation on which to execute our growth strategy."

In a separate announcement on Tuesday, Iomart announced the appointment of Richard Last as independent non-executive chair, effective 12 June.

It said Last would bring extensive experience from his roles at various technology companies, including Hyve Group and Gamma Communications.

This appointment would allow Lucy Dimes to step down as chair while continuing as full-time CEO.

"In taking up the role of chair, I was impressed by the leading position Iomart has established in the cloud services marketplace, the strength of its customer relationships and the talent across the team," said Richard Last of his appointment.

"I am very much looking forward to working with the board to leverage these strong foundations and support the group in realising its growth ambitions."

At 1625 BST, shares in Iomart Group were down 2.08% at 141p.

Reporting by Josh White for Sharecast.com.