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Maintel warns of tougher second half
Failure to convert all of the major deals in its pipeline leads firm to update markets on the impact on the rest of its fiscal year
Just a few weeks after Maintel shared flat H1 revenues, the channel player has updated the market with warnings that the rest of the year is going to be tougher than expected.
The bitter irony for the managed services and cloud comms and connectivity player is that it had signalled to the markets that it was well placed for the second half, with a strong pipeline of business.
Today’s trading statement indicated issues with that sales pipeline were to blame for a recalibration of expectations.
“While the company entered the second half of the year with its largest sales pipeline for many years, it has experienced delays in pipeline closures and the loss of a significant key deal for the year,” the firm stated in its update.
“As a consequence, the board now expects revenue for FY 2025 to be around £95m, with slightly unfavourable gross margin levels due to the remaining revenue mix. Adjusted EBITDA is now expected to be around £7m,” it added.
Maintel started the second half with three significant deals on the table. Two were signed but the third was unsuccessful, despite positive client feedback. The deals would have been a contributor to the second-half performance.
Its statement shared the details of the two successful deals: “The two key deals successfully secured represent a total contract value of £9.7m,” it said. “The first was with a leading UK retailer to deliver an SD-WAN managed service across over 300 locations. The second was a managed Local Network and Wi-Fi contract for a significant county police force.”
Security and connectivity
The two successful signings underline the firm’s strategy to concentrate on a few key areas, with the deals coming under the security and connectivity area.
Despite the failure of the third deal, the commitment to the strategy to become a specialist, rather than generalist, managed service provider continues.
“The board remains committed to its specialist communications managed service provider [MSP] strategy and the continued transformation programme, and it is confident that in combination this will ultimately support the company’s return to sustainable growth, profitability and cash generation,” the statement continued.
“The board believes the group’s focus on continuing to build differentiation in the market and optimising our operating models for growth will enable the company to deliver longer term increase in shareholder value,” it added.
The phrase that had been used when preliminary H1 numbers were shared at the end of July was “cautiously optimistic”. The channel player had hoped the work building the pipeline would deliver, and, at the time, the board felt it was on track to meet expectations.
Despite the failure to convert a major deal, the strategic shift to focus on unified communications and collaboration, customer experience, and security and connectivity continues.
Since the firm went through a rebranding exercise in November 2024, the pressure has been on to get the message about the shift to a specialised MSP out in the market. As a result, the first six months of the year saw Maintel widen its routes to market, appearing at events and launching digital campaigns, as well as the traditional advertising and collaborating with vendors on leads.
