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AdEPT benefits from increasing customer confidence

Managed service player shares H1 numbers as its customer base continues to emerge from the shadow of the pandemic

Managed service player AdEPT has revealed that, like others in the channel, it is surfing the waves of recovery and benefiting from improvements to its financial position.

The channel player’s interim results for the six months ended 30 September showed revenues increasing by 20% to £34.3m, with managed services improving by 4%, accounting for 87% of that total. Pre-tax profits climbed by 16% to reach £3.5m.

The firm saw organic growth of 6% in its cloud centric strategic services revenue, coming in at £14.6m.

The business also continued its move away from traditional telephony, with revenues on that side falling in line with the expectations set out by the board. Customers are increasingly looking for more up-to-date alternatives.

The firm saw its public sector and healthcare revenues improve by 48% and demand for its VoIP services and Nebula cloud platform also helped to drive turnover increases in H1.

Ian Fishwick, chairman of the AdEPT Group, said that “activity continued to normalise in our sector” and the firm had benefited from the economy starting to recover from the pandemic.

In his comments to investors, AdEPT CEO Phil Race said confidence was returning to its customers and many were looking for cloud technology as a means of getting them back on their feet after Covid.

The first half also saw the firm acquire Datrix as it looked to bolster its cloud services proposition and Race said this had already made a positive contribution and the team has embraced being part of the larger group.

Across the group, AdEPT has been pursuing a strategy called Project Fusion to bring all of its business onto the One AdEPT platform and the H1 update indicated that the process, which includes utilising a customer relationship management (CRM) and service management platform, was nearing 100% completion.

The business also set out its environmental, social and governance (ESG) initiatives with a 17-point plan of action.

Aftershocks from the pandemic and the component shortage were the main problems the business was dealing with, but in that respect, so are all of its competitors.

Looking to the future, Fishwick struck a positive tone, indicating that AdEPT expected to be in a position to build on the momentum in the first half.

“Our focus in H2 is on the continued delivery of our stated objectives with an emphasis on the achievement of further organic growth, using the group’s strong cash generation to reduce net senior debt, as we capitalise on the macro shift to cloud centre solutions,” he said.

“AdEPT is on track to achieve management expectations for FY22. The group’s strategic progress, coupled with a strong pipeline of opportunities across the public and private sectors, driven by macro technology market trends, ensure that the prospects for AdEPT are stronger than  ever.”

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