Managed IT services and cloud hosting provider, SysGroup has posted record revenues of £19.5m and profits (adjusted EBITDA) of £2.8m in its annual results announced today. In the year to March 31, 2020, the Liverpool headquartered group, increased its revenues by 53% and almost doubled its profits, which were up by 99% on the previous financial year. Significantly, 77% of the company’s income came from recurring revenues from long term service agreements.
SysGroup, led by CEO Adam Binks, has seen strong growth with increased demand from companies continuing on the journey of digital transformation, a trend which grew dramatically at the end of the year with lockdown and the need for customers to rapidly implement remote working. SysGroup has also enjoyed dramatic growth through strategic acquisition, buying managed connectivity company Hub Network Services (HNS) in June 2019, following the previous year’s purchase of managed IT service provider, Certus Technology Group.
Commenting on the results Binks said: “We delivered increased revenues and EBITDA, whilst integrating our largest acquisition to date, which rounds out our capability to help our customers transform their businesses; a capability that was pressure-tested by lockdown at the end of the financial year. Despite COVID-19 dominating the end of the year I have been impressed with how the team have stepped up to support and service our customers during these challenging circumstances with our core operational model supporting the rapid switch to remote working.
“While there is still some uncertainty around the impact of COVID-19, we believe it has presented us with significant opportunities. We have seen an accelerated shift towards remote working solutions for our customers, alongside a decentralisation of their core IT infrastructure towards more flexible and more resilient configurations. Investment in the appropriate cloud technology is becoming ever more mission-critical for businesses to survive and thrive.”
Acquisitions integrated under unified brand
SysGroup sees its two recent acquisitions as pivotal to the company’s growth in terms of expansion of services, economies of scale and geographic coverage, with locations now across the country in London, Liverpool, Newport, Telford and Bristol. Work to integrate the capabilities and process of HNS and Certus into a single platform under a unified offering is largely complete as SysGroup ramps up its marketing communications to promote its enhanced capabilities, value and solutions for customers in the post COVID-19 world. The company continues to evaluate further acquisitions and will look to take advantage of increased opportunity in anticipation of further market consolidation.
Customer retention backed by new C-Level appointments
SysGroup continues to drive for ever higher levels of customer retention and growth. In 2019 the company launched its ‘customer engagement strategy’ and reported a customer satisfaction rate for the year that was consistently above 97%. To underpin and drive these strategic enhancements SysGroup expanded its Executive Leadership team with the three new appointments in the course of the financial year. Nick Guite joined as Chief Sales Officer, Andrew Vize was appointed Chief Marketing Officer and Paul Brown is the group’s new Chief Technology Officer.
Adam Binks added, “The past year has been dramatic in more ways than one. We enjoyed rapid growth and another successful acquisition, then ended the year with lockdown. We reacted quickly to the changing conditions. By reorganising the entire operation to remote working, while ensuring continuity of service we have demonstrated what is achievable with the right mix of agile technology services and skills.”
Binks believes the company is well positioned for the post lockdown world where, not only will organisations need to enable more flexible working patterns but will also need to review their core IT infrastructure in the light of the crisis. According to Binks, companies will need to accelerate the shift from on-premise IT infrastructure that is expensive and cumbersome to scale up and maintain, to a cloud-based environment that can respond and scale on-demand to changes in the business needs.
Binks concluded: “As we look ahead, I remain optimistic for continued growth, supported by a robust balance sheet, a diverse customer base and the growing relevance of our solutions. We will be focusing on those organisations that have learned the lessons of lockdown and need a trusted partner to help them transition through the complexities of the technological landscape. Those organisations that think this was just a blip and go back to the old ways of doing things will not survive in our new world.