Zenzeta - stock.adobe.com
Redcentric positioning for MSP future
Firm’s half-year numbers come as the business sets out its strategy to focus on high-margin managed services
Redcentric has shared it half-year numbers and lifted the lid on its progress in transforming into an MSP-focused business.
The six months ended September 2025 came before the business announced the sale of its datacentre operation for £127m towards the end of October.
Even before that move had been made, the business was pivoting to a focus on managed services, and will be concentrating on that model going forward, with the datacentre business sale expected to conclude around the end of March 2026.
In H1, revenue dropped by 3.6% to £66.8m from £69.2m, but the percentage of recurring revenue improved from 88% to 90.4% in the period, which was an improvement of 2.5%.
Adjusted EBITDA was £17.4m, slightly down from £18.2m, and gross margin improved up 2.2% from 58.3% to 60.5%.
Apart from working on negotiations to sell off the datacentre business, the other highlights of the first half included the arrival of Michelle Senecal de Fonseca, formerly a non-executive director, as CEO in May, and Tony Ratcliffe joining as chief financial officer in August.
With the focus shifting to being a leading MSP, the firm took steps in that direction in H1, with plans to bolster the security offerings it can provide, as well as increase its activities in the public sector, supported by its sovereign cloud capabilities.
Expanding relationships
The business has also looked to expand relationships with partners in selected vertical markets to bring on board fresh customers and growth.
“I am delighted to deliver these positive results, in what has been a very busy first half for the group,” said Senecal de Fonseca, CEO of Redcentric. “Whilst the transformational year has been challenging, it is pleasing to see that our focus on securing and maintaining higher-margin business and managing costs has already delivered improved margins from the MSP business.
“With the sale of the DC business now announced, our ongoing focus is very much on MSP as we start to execute the new strategy and growth plan, which we believe will accelerate growth in both revenue and earnings in the years to come, building on the strong foundations of a market-leading position and a high recurring revenue model,” she added.
Redcentric remains focused on its cost base, and is looking to scale the business to deliver a solid MSP proposition and use the datacentre sale money to improve its financial position.
In her comments accompanying the results, Senecal de Fonseca said the decision to focus on the MSP business was a wise one, which would bring future growth and security for the firm.
“UK customer demand for managing IT infrastructure, cyber security and end-user systems is well established, with the service addressable market estimated at over £10bn per annum,” she said. “This IT managed services market is highly fragmented, supplied by approximately 12,000 providers in the UK. There are a small number of very large, predominantly global providers, a huge number of quite small providers and a modest number of mid-tier providers. It is the large and mid-tier providers that dominate the marketplace, and this is where Redcentric sits as a mid-tier leader.
“Redcentric enjoys a diverse portfolio of customers equally split over the public and private sectors,” said Senecal de Fonseca. “It has built a particularly strong position in the public sector, particularly with NHS trusts and associated social care, as well as in the commercial markets among customers that require compliant oriented services. Management believes the group has the requisite national scale to provide diverse and attractive product and service offerings with the ability to be nimble enough to offer the right level of customised and technically compliant services with intimate account engagement.”
