News Column

Accumuli Swings To Loss On Acquisition Costs, Raises Dividend

June 23, 2014

Hana Stewart-Smith

LONDON (Alliance News) - Accumuli PLC Monday swung to a loss in the year to the end of March on acquisition costs, although it raised its total dividend and expressed confidence for another "successful financial year" ahead.

The company, which produces security software and IT services, proposed a total dividend of 0.46 pence for the year, up from 0.4 pence.

Accumuli posted a pretax loss of GBP943,000, swung from a profit of GBP298,000 in the previous year, despite seeing revenue rise to GBP16.6 million from GBP14.1 million, as it was hit by costs from the acquisitions of Signify Solutions Ltd and Eqalis Ltd during the year.

Acquisitions contributed 23% of revenues and 29% of gross profit during the year.

After the year end the company has acquired ArmstrongAdams Ltd. The company said it remained on the look out for further acquisitions that meet its investment criteria.

In the company's Professional Services business gross profit was GBP2.1 million, up from GBP1.6 million, boosted by acquisitions and projects, including a large hardware replacement project in Core Network Services business.

In Managed and Support Services gross profit rose to GBP6.1 million from GBP3.9 million. Excluding acquisitions, gross profit rose 3%, hit by margin pressure and a longer sales cycle than expected in its managed service contracts.

Technology Sales gross profit declined to GBP1.8 million from GBP2.1 million, as it shifted to margin-rich services and saw reduced sales of Webscreen products after it sold the Webscreen intellectual property to Juniper Networks Inc.

Accumuli's gross margin improved to 60% from 53%, boosted by acquisitions and its increased focus on higher margin services.

The company said it expects the level of gross profit from legacy product sales to continue to decline, although it expects revenues from services for Splunk Inc's software to increase as the trend for Big Data picks up.

Shares in Accumuli were trading down 3.1% at 27.86 pence Monday morning.

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Source: Alliance News

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