Acquisition strategy helps AdEPT deliver solid results

Managed service player reinstates dividend as it enjoys revenue and gross profit increases

Managed services player AdEPT has seen its fortunes improve as a result of its decision to acquire Datrix last April.

The channel player shared its full-year numbers for the 12 months ended 31 March, with it clear that the move for Datrix has given the firm a chance to get deeper into the strong software-defined wide area networking (SD-WAN) and secure access service edge (SASE) markets.

“The acquisition of Datrix, in April 2021, significantly extended the group’s capabilities and enabled AdEPT to increase its potential ‘wallet share’ in the ever-expanding ICT space,” said Phil Race, CEO of AdEPT. “The introduction of new partnerships and services that allow AdEPT to tap into the fast-growing markets of SD-WAN and SASE is leading to significant sales successes.

“During the period, this team secured significant projects with organisations, including Nottinghamshire County Council, the Royal Surrey County Hospital, Public Health England and Trident IP.”

The business was in a position to reinstate a dividend after revenues increased by 18% to £68.1m and gross profit improved by 17% to £32.4m. Recurring revenues now represent 73.6% of the total.

Cloud-centric strategic services revenues were up 18% to £29.5m and the firm continued to change the business, with the total revenues coming from traditional telephony, as a percentage of total revenues, reduced to 13% from 19% in the same period last year. Managed services accounted for 87% of revenue and Ebitda, and the business added more than 100 fresh customers in the year.

AdEPT also indicated to investors that the focus was now solely on delivering strong organic growth and reducing senior debt.

Race said the firm was in a strong position, with demand continuing to rise, and there were plenty of reasons to be optimistic about the fiscal year ahead.

“The technology market is vibrant and growing, underpinned by the evolution of our working patterns, during and after the pandemic, and the need for business-critical cyber security across all digital services,” he said.

“The new financial year has started well, with the group building on the momentum gained in Q4. This, combined with our comprehensive portfolio of capabilities, our extensive and strong industry partnership and numerous flagship references from across the public and private sectors, gives us confidence in prospects for the group both in the year ahead and beyond.”

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