Iomart Group has reported expected revenue of approximately £115m, up from £103m a year before.
The Glasgow-based cloud computing company's pre-close trading statement for the year ended 31 March 2023, also revealed adjusted earnings of approximately £36.2m - down from £38m year-on-year and adjusted profit before tax of approximately £14.6m - falling from £17.1m.
These results were broadly in line with sell-side analyst estimates, with stability of customer renewal rates across all areas of the business providing a solid base of recurring revenues.
The group's sales pipeline improvement during the first half of last year, converting into stronger order booking levels in the second half, providing "positive momentum" into this new financial year.
The latest revenue figure is a record level for iomart and is a combination of a return to long-term historic customer renewal levels, inflationary pricing adjustments - primarily for datacentre energy usage - plus the completion of the acquisition of Concepta Capital in August 2022.
Non-recurring revenue is expected to be approximately £9.2m - up from £7.1m - meaning recurring revenue remains at 92% of total revenue - down marginally from 93%.
The datacentre sector as a whole has had to navigate the significant challenges in the energy markets and during the year the group’s electricity costs increased by approximately £7m during the period - with these costs passed through to the customer base.
The earnings figures reflect both the revenue mix and investment in up-skilling employees, alongside wage increases and cost of living support. Margins in the year were "heavily impacted" by the pass through of energy costs - and to a lesser extent lower margin within the Concepta deal, primarily from its reselling activities.
Cash generation continued to be strong, with the year-end net debt expected to be approximately £41m roughly in line with the £41.3m reported at 31 March 2022.
The group expects to announce its full results on 13 June.
Chief executive Reece Donovan commented: “We saw our pipeline improve in the first half and this converted to stronger order booking levels as we completed the year.
“The team has worked hard to ensure momentum in the execution of our strategic plan and continuous improvement within the business.
“This gives us confidence that we will continue to be successful within the wider growing cloud sector.”
Don't miss the latest headlines with our twice-daily newsletter - sign up here for free.
