Bytes Technology Group extended its track record of double-digit growth in the six months to August 31 as customers continued to invest in IT in spite of a weaker macro-economic environment in the UK.
“We have made a really positive start to the year and extended our long track record of consistent double-digit growth both before and since our listing in 2020. This reflects robust demand from both corporate and public sectors,” the CEO of the UK provider of software, security and cloud services, Neil Murphy, said in a statement yesterday.
He said they had made a good start to the second half, although they were mindful of macro-economic pressures.
“Our successful strategy of acquiring new customers and then growing our share of wallet, building on our strong vendor relationships and the technical and commercial skills of our people, makes us confident that the group is well positioned for the remainder of the financial year.”
He attributed their success to high-quality customer service, while the new ways of working brought about by the Covid-19 pandemic had become entrenched.
“We believe the conditions we are operating in represent the new normal. Thanks to our expertise and partnerships with the world’s leading vendors, we are confident the group is well positioned,” he said.
Revenue increased 27.9% to £93.5 million (R1.9 billion) and gross profit increased 23.8% to £65.5m. Headline earnings per share increased 17.4% to 9.06 pence. The interim dividend was raised 20% to 2.4p.
Following recent guidance by the IFRS interpretation committee, all software revenue was being accounted for on an agency, or “net” basis. Previously, the element of software revenue comprising indirect licence sales of non-cloud licences and licences not requiring critical updates had been recognised “gross”.
This change resulted in a reduction in statutory revenue figures and the prior year revenue and cost of sales figures were re-stated.
Gross profit growth reflected across both public and corporate sectors, per customer.
Cash at August 31 was £35.8m (£42.9m) which was after the payment of £29.7m dividend during the past 12 months, of which £24.9m was paid during the first half.
The group did not experience any bad debt write-offs in the period, and management was confident cash conversion would return to higher levels in the second half.
Bytes Software Services was named Microsoft Partner of the Year for Operational Excellence in 2022 from more than 3 900 partner entries globally. Almost 300 new customers were won across the group in the six months. A 120% renewal rate was achieved from existing group customers.
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