A rebound in spending among corporate customers is not a short term blip, according to Trustmarque CEO Scott Haddow.
The software and services reseller today posted results for the year to 31 August 2010 with revenues down 12% to £107.7m and net profits dipping from £3.9m to £3.4m but he noted uplift in the commercial sector.
"We are seeing a lot of confidence returning to the corporate market, there was a hiatus of spend for the last eighteen months but most customers understand they need to re-invest in the infrastructure," he told MicroScope.
Haddow pinned the top line decline on its decision to exit third party software provision and the bottom line dip on its £1.5m transformational investment in the Trustmarque Enterprise Solutions Group (TESG) in 2009.
Sales to corporate customers grew more than 30% to represent 40% of the firm's total revenues with public sector sales rising more modest, up 7%, and accounting for the remaining revenues.
Haddow noted that from June last year - a month after the coalition formed a government - there was a real sea change in the behaviour of public sector customers with spending practically falling off the edge of a cliff.
Gross profits for fiscal 2010 went up 10.5% to £11m, "primarily" due to TESG which sells business intelligence, security, infrastructure optimisation, management license services, storage, virtualisation and unified comms.
"When you are just transacting licenses you are at the behest of all the other LARS that don't necessarily have any service capabilities and it become a bit of a shark tank, whoever wants to take it to the lowest margin will win.
"We are transitioning away from that businesses and hence if you sell services, solutions and you can command a reasonable return," he said.