REG - Software Circle PLC - Interim Results
Today 07:00
For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20251125:nRSY8088Ia&default-theme=true
RNS Number : 8088I Software Circle PLC 25 November 2025
Prior to publication, the information contained within this announcement was
deemed by the Company to constitute inside information as stipulated under the
UK Market Abuse Regulation. With the publication of this announcement, this
information is now considered to be in the public domain.
25 November 2025
Software Circle plc
("Software Circle", the "Company" or the "Group")
Unaudited Interim Results for the period ended 30 September 2025
Financial highlights
Six months to Six months to
30 September 30 September
2025 2024
Revenue £10.2m £8.9m
Operating EBITDA ("oEBITDA")(1) £3.1m £2.3m
Adjusted EBITDA ("aEBITDA")(2) £2.3m £1.5m
Operating Cash Flow Per Share ("OCFPS")(3) 0.5p 0.2p
Cash flow from operating and other investing activities(4) £1.8m £0.8m
Cash and Cash Equivalents £4.8m £12.7m
Earnings Per Share (EPS) (0.3)p 0.3p
Net debt / (cash) £7.1m £(2.4m)
(1) oEBITDA = EBITDA before impairments, share option charges, exceptional
costs, acquisition related costs, central administration costs and the
capitalisation of qualifying development costs
(2 ) aEBITDA = oEBITDA less central administration costs
(3) ( )OCFPS = Cash flow from operating and other investing activities
divided by the weighted average number of shares
(4 ) Cash flow from operating and other investing activities = Cash flow from
operating activities plus cash flows from investing activities less
acquisition of subsidiaries net of cash and payment of deferred consideration
● Revenue increased by £1.3m, a 15% increase
● oEBITDA increased by £0.8m, growth of 33%
● aEBITDA increased by £0.8m, growth of 44%
● 4% organic revenue growth achieved across our
acquisitions*
● 16% organic oEBITDA growth achieved across our
acquisitions*
● On an annualised basis, Operating Return on
Capital Deployed ("oROCD") increased to 25%
● OCFPS increased by 150% to 0.5p
Operational highlights
● Artificial Intelligence Finance Limited acquired
in August 2025.
Post period events
● Broker Information Services Limited was acquired
in October as our tenth acquisition. Together with AIF, this forms our first
platform, a complementary cluster of software businesses serving the same
vertical.
● Software Circle is now a group of eleven VMS
businesses, with annualised run rate revenues of approximately £24m at an
aEBITDA margin of 25%.
*Acquired portfolio companies excluding our legacy Nettl Systems business.
For further information:
Software Circle plc
Gavin Cockerill (CEO)
investors@softwarecircle.com
Allenby Capital Limited (Nominated Adviser and broker)
0203 328 5656
David Hart / Piers Shimwell (Corporate Finance)
Joscelin Pinnington/ Amrit Nahal (Sales and Corporate
Broking)
Interim Statement
During the six-month period ended 30 September 2025, we continued to make
strong progress. Our focus remains on building a diversified group of vertical
market software (VMS) businesses, each operating autonomously within its
niche, while benefiting from shared financial and operational discipline,
capital allocation rigour, and the long-term stability of permanent ownership.
Our companies develop mission-critical systems, deeply embedded in the
day-to-day workflows of their customers. These are not generic tools, they are
specialist platforms, built and supported by passionate teams who care deeply
about solving the intricate and highly specific problems of their respective
markets.
Our ambition is to become the UK's leading serial acquirer and operator of
such VMS businesses. To achieve this, we believe success depends on three key
disciplines:
1. Maintaining acquisition discipline - Remaining focused on long-term
returns and quality of earnings rather than pace alone.
2. Driving improvability - Identifying and implementing improvements
using our business systems and shared learnings to enhance the performance of
each acquired company consistently over time.
3. Funding growth in an equity-efficient way - Balancing risk, pace,
and the impact on Operating Cash Flow Per Share to compound shareholder value
sustainably.
During the period, we've demonstrated meaningful progress across all three
disciplines. We've expanded our portfolio, completing one acquisition within
the period and a further acquisition in October, marking our ninth and tenth
completed transactions since we began this strategy in 2022.
We've built a group that today is home to eleven software business units which
operate within the following segments: Graphics and Ecommerce, Property,
Health and Social Care Management, Professional and Financial Services, and
Education. Together they now deliver, on an annualised run rate basis, £24m
of revenue and approximately £8m of oEBITDA. We've deployed £36m to date,
rising to £41m when considering deferred consideration and the contingent
consideration payable based on current performance levels.
We continue to maintain discipline against our M&A guardrails: UK and
Irish based VMS targets in clearly defined niches, majority recurring
revenues, low churn, diversified customer bases and entry valuations within
our aEBITDA range.
Having now surpassed our goals at "Gate 4", achieving £5 million of
annualised aEBITDA, this should now afford us more financing optionality which
will help us fund our journey as we progress toward our next major milestone
"Gate 5", achieving £15 million of annualised aEBITDA.
We welcomed Artificial Intelligence Finance Limited ("AIF"), known as Online
Application ("OA") during the first half of the financial year. They provide
services to insurance and mortgage brokers as well as to lenders and insurers
via a suite of software products, OA Mortgage, OA Life + CRM, OA Lender and OA
Insurer. OA was acquired in August, followed closely by Broker Information
Services Limited ("BIS") post period in October. OA and BIS operate within the
same sector and together form our first platform. A cluster of complementary
businesses within our Professional and Financial Services segment.
I'm pleased to report that Group trading continues to align with our internal
forecasts. We've continued to drive organic growth within our acquired
portfolio and have seen the key metrics of the Group improve again. The
performance of our acquired business units remains encouraging, meeting our
expectations and reinforcing the strength of our strategic direction.
Trading Results and Cash
Revenue rose to £10.2m (2024: £8.9m) an increase of 15%. We've driven growth
in organic revenue of 4% from the acquired operating units. Overall organic
revenue growth continues to be impacted by a decline in the lower margin,
non-recurring revenue within our legacy Nettl Systems business, part of our
Graphics & Ecommerce revenue segment. Whilst Nettl's pace of decline is
slowing, its revenue fell to £2.8m (2024: £3.4m), meaning an overall decline
in organic revenue of 4% (2024: 10% decline).
The Group's revenue mix continues to shift towards subscription revenue, with
recurring revenues representing 73% of Group revenue (2024: 67%), supporting a
further improvement in gross margin quality and earnings resilience.
Gross profit for the Group rose by 24% to £7.8m (2024: £6.3m) and our gross
margin percentage increased to 76% (2024: 70%).
The addition of Total Drive in March 2025, along with organic earnings growth
delivered from the existing portfolio has meant oEBITDA increased by 33% to
£3.1m (2024: £2.3m) equating to 30% of revenue (2024: 26%). Our two most
recent acquisitions, OA late in the period and BIS post period, will have a
more significant impact on our progress in the second half of the year.
Acquisitions contributed £0.6m to the increase in oEBITDA. In addition,
despite the overall decline in organic revenue, excluding Nettl, we delivered
16% organic growth in oEBITDA, adding a further £0.2m overall.
Central costs remain broadly consistent at £0.8m (2024: £0.7m). After these
Central Costs, our aEBITDA increased by 44% to £2.3m (2024: £1.6m) at an
improved aEBITDA margin of 22% of revenue (2024: 18%).
Operating loss was £0.8m (2024: profit £1.4m). The £2.2m movement in
profitability is due to two key items. First, depreciation and amortisation
charges increased to £3.0m (2024: £2.3m) as non-cash amortisation charges
related to acquisitions rose to £2.3m (2024: £1.7m). Given the current scale
of the Group and our level of acquisition activity, these non-cash charges
currently have a more pronounced impact on reported profit, even though they
do not affect cash generation. Second, the prior period included the
exceptional £1.7m credit received in 2024 as a result of the divestment of
the printing.com domain.
Looking ahead, as we continue to acquire profitable businesses at a similar
pace, we expect the incremental earnings from those acquisitions to outweigh
the relatively fixed amortisation charges arising from historical acquisition
costs. Because amortisation does not scale in line with revenue or
profitability, we anticipate that growing operating profits will progressively
dilute its impact, supporting a sustained transition into positive net
earnings.
At 30 September 2025, the Group held cash of £4.8m (31 March 2025: £8.6m).
Our operating activities generated £2.3m of cash (2024: £1.5m). We've paid
£4.5m in respect of acquisitions, funded through existing cash reserves, and
paid £1.1m servicing debt. Total debt rose to £11.9m (31 March 2025:
£10.8m) with additional deferred and contingent consideration of £2.3m
arising with the OA acquisition.
On an annualised basis, our Operating Return on Capital Deployed ("oROCD")
increased to 25% and our overall Return on Capital Deployed ("ROCD") to 18%,
compared with 24% and 16% respectively reported for the previous full
financial year. We calculate Operating and overall ROCD by dividing oEBITDA
and aEBITDA respectively over Capital Deployed, being the average of the
opening and closing amount of cash paid, including acquisition related
expenditure, in respect of investments in subsidiary companies.
We've said that maximising Operating Cash Flow Per Share, in the long term, is
the number one financial priority for us. This measure is up by 150% to 0.5p
(2024: 0.2p).
Operating Segments
Across the portfolio, we focus relentlessly on the measures that we believe
will compound shareholder value over time. We use oEBITDA and aEBITDA to
assess operating performance and portfolio efficiency, we track OCFPS as our
ultimate lag measure of value creation, and we monitor ROCD/oROCD to ensure
our cash returns on deployed capital exceed our thresholds. These continue to
guide decision-making across the Group.
Our decentralised model continues to do what it is designed to do. Leaders
closest to customers make the day-to-day decisions, while we support them with
shared playbooks to lift growth, expand margins and reduce churn. As a result,
our acquired VMS units continue to track ahead of entry assumptions and are
delivering improving returns on capital.
Operating Segments - period ended 30 September 2025
£'000 Graphics & Ecommerce Professional & Financial Services Health & Social Care Property Education Total Group
License & Subscription revenue 1,671 1,879 1,883 878 1,126 7,437
Product & Service revenue 2,357 263 15 2 120 2,757
Total Segment Revenue 4,028 2,142 1,898 880 1,246 10,194
% Recurring 41% 88% 99% 100% 90% 73%
% Group Revenue 40% 21% 19% 9% 12% n/a
Segment oEBITDA 472 793 756 394 694 3,109
% Group oEBITDA 15% 26% 24% 13% 22% n/a
In the period, we've seen the strongest organic growth in our Education
segment, with 17% growth in revenue and 64% growth in oEBITDA, which has been
driven by a combination of an increasing new customer count, expanding usage
and adoption within our existing customer base, and disciplined cost control.
Our Professional and Financial Services segment also fared well, with growth
in organic revenue of 7% and 22% in oEBITDA. This was primarily the result of
revenue expansion within our existing customer base.
In our Health and Social Care segment, we saw a decline in organic revenues of
7% primarily due to an increase in churn. Investment in platform improvements
is starting to have a positive impact and we expect to see revenue expansion
from this investment in the latter part of the current financial year. Despite
a decline in organic revenue, improved efficiency and cost control meant
organic oEBITDA in the segment grew by 3%.
Our Graphics and Ecommerce segment saw the softest performance. Although
licence and subscription revenue was more stable, product revenue, which
represents more of the mix than is typical in our portfolio, declined,
resulting in a drop in organic revenue of 11%. This, coupled with the increase
in Employers National Insurance, led to a decline in oEBITDA of 25%.
Our Property segment continued its strong performance, growing revenue
organically by 11%. Steady growth in new logos and usage expansion has driven
this. We've invested some of this growth into the platform meaning growth in
organic oEBITDA was 5%. The result of this is a new modular revenue stream
which should have a positive effect in the second half of the year.
Embedding AI Across Our Operating Units
Across the Group, our operating units are increasingly using artificial
intelligence in practical, problem-solving ways. We are embedding AI into
existing workflows and products where it can create clear value for customers
and teams.
Our businesses are using AI to improve response and resolution times in
customer support, assist sales teams, and help product and development teams
work faster while maintaining quality. In several units, AI tools are now used
to extract and summarise information from large documents. This is already
reducing the burden on teams when responding to due diligence questionnaires,
complex tenders and security assessments, freeing colleagues to focus on
higher value work and client relationships.
We are also exploring AI-driven features within our software platforms
themselves, for example to highlight insights from customer data, automate
routine checks or guide users through complex workflows. These initiatives are
at different stages of maturity across the Group, and we are sharing learnings
between operating units so that proven approaches can be adopted quickly
elsewhere.
To support this, we have established an internal AI community, bringing
together AI champions, product leaders and developers from across the Group to
share tools, patterns and governance practices. Our focus remains on using AI
safely and responsibly, with appropriate controls around data protection and
security. Over time, we expect this disciplined, customer-led approach to AI
to contribute to improved service quality, more efficient internal processes
and a stronger competitive position for our operating units.
Outlook
This half year marks an inflection point for Software Circle. Moving beyond
Gate 4 on an annualised basis, which should unlock debt options that give us
financial flexibility without diluting shareholders.
Our focus now shifts firmly to Gate 5, achieving £15m of annualised aEBITDA
and building a Group capable of sustaining its own growth through internally
generated cash flow. With strong recurring revenues, disciplined capital
allocation, and a growing portfolio of exceptional operating units, we are
well positioned to deliver long-term, compounding value for our shareholders.
Including our latest acquisitions, on a run-rate basis and before any further
M&A, we expect annualised revenue of approximately £24m and view an
aEBITDA margin of approximately 25% as a realistic target as operating
discipline continues to improve. Our pipeline is healthy, we remain
disciplined on valuation and operational fit. The combination of decentralised
execution, improving quality of earnings and a scalable funding platform
underpins our confidence in compounding OCFPS over the long term.
Finally, our sincere thanks to all of our talented teams across the Group for
their focus and execution in the year so far. Their work continues to
strengthen the foundations of a resilient, cash-generative and enduring
software group.
Matthias
Riechert Gavin
Cockerill
Chairman
Chief Executive Officer
24 November 2025
Unaudited Interim Results for the period ended 30 September 2025
Consolidated Statement of Comprehensive Income
for the six months ended 30 September 2025
Unaudited Unaudited Audited
Note Six months to Six months to Year ended
30 September 30 September 31 March
2025 2024 2025
£000 £000 £000
Total Total Total
Revenue 3 10,194 8,917 18,274
Direct costs (2,416) (2,625) (5,028)
Gross profit 7,778 6,292 13,246
Staff costs (4,476) (3,073) (7,433)
Other operating charges (1,077) (1,219) (2,404)
Depreciation and amortisation (2,966) (2,277) (4,608)
Profit on disposal of domain - 1,712 1,712
Value adjustment on consideration payable (107) - 191
Operating (loss) / profit (848) 1,435 704
Financial income 62 187 386
Financial expenses 4 (829) (309) (887)
Value adjustment on bond settlement - - (874)
Net financing expense (767) (122) (1,375)
(Loss) / profit before tax (1,615) 1,313 (671)
Taxation 397 (68) 342
(Loss) / profit for the period (1,218) 1,245 (329)
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Exchange differences on translation of foreign subsidiaries 159 (74) (64)
(Loss) / profit and total comprehensive income for the period (1,059) 1,171 (393)
Earnings per share - Basic and diluted 5 (0.31)p 0.32p (0.08)p
Consolidated Statement of Financial Position
at 30 September 2025
Unaudited Unaudited Audited
Note 30 September 2025 30 September 2024 31 March
2025
£000 £000 £000
Non-current assets
Property, plant and equipment 675 1,150 764
Intangible assets 6 30,846 23,251 26,862
Total non-current assets 31,521 24,401 27,626
Current assets
Inventories 19 25 26
Trade and other receivables 7 2,277 2,622 1,881
Cash and cash equivalents 4,798 12,684 8,566
Total current assets 7,094 15,331 10,473
Total assets 38,615 39,732 38,099
Current liabilities
Trade and other payables 8 4,227 4,304 3,830
Other interest-bearing loans and borrowings 9 4,185 8,057 2,692
Total current liabilities 8,412 12,361 6,522
Non-current liabilities
Other interest-bearing loans and borrowings 9 7,683 2,248 8,108
Deferred tax liabilities 2,130 2,219 2,075
Total non-current liabilities 9,813 4,467 10,183
Total liabilities 18,225 16,828 16,705
Net assets 20,390 22,904 21,394
Equity
Share capital 3,901 3,901 3,901
Share premium 28,255 28,255 28,255
Merger reserve 838 838 838
Share based payment reserve 198 89 143
Translation reserve 144 (16) (15)
Retained earnings (12,946) (10,163) (11,728)
Total equity 20,390 22,904 21,394
Consolidated Statement of Changes in Shareholders Equity
for the six months ended 30 September 2025
Share Share Premium Merger Share based payment reserve Translation reserve Retained
Capital Reserve earnings Total
£000 £000 £000 £000 £000 £000 £000
Opening shareholders' funds at 1 April 2024 3,901 28,255 838 37 58 (11,408) 21,681
Total comprehensive loss for the period - - - - (74) 1,245 1,171
Share option charge - - - 52 - - 52
Closing shareholders' funds at 30 September 2024 3,901 28,255 838 89 (16) (10,163) 22,904
Total comprehensive loss for the period - - - - 10 (1,574) (1,564)
Transfer of translation reserve on closure of foreign subsidiaries - - - - (9) 9 -
Share option charge - - - 54 - - 54
Closing shareholders' funds at 31 March 2025 3,901 28,255 838 143 (15) (11,728) 21,394
Total comprehensive income for the period - - - - 159 (1,218) (1,059)
Share option charge - - - 55 - - 55
Closing shareholders' funds at 30 September 2025 3,901 28,255 838 198 144 (12,946) 20,390
Consolidated Statement of Cash Flows
for the six months ended 30 September 2025
Unaudited Unaudited Audited
Six months to 30 September 2025 Six months to 30 September 2024 Year ended
£000 £000 31 March
2025
Note £000
Cash flows from operating activities
(Loss) / profit for the period (1,218) 1,245 (329)
Adjustments for:
Depreciation, amortisation and impairment 2,966 2,277 4,789
Profit on disposal of plant and equipment 1 (92) (223)
Profit on disposal of intangible assets 3 - (1,712) (1,712)
Share based payments 55 52 106
Financial income (62) (187) (386)
Financial expense 829 309 887
Value adjustment on bond settlement - - 874
Bad debt (credit) / expense (44) (36) 83
Tax (income) / expense (397) 68 (342)
Value adjustment on consideration payable 107 - (191)
Operating cash flow before changes in working capital and provisions 2,237 1,924 3,556
Change in trade and other receivables 47 294 978
Change in inventories 7 8 7
Change in trade and other payables 179 (946) (1,601)
Cash generated from operations 2,470 1,280 2,940
Corporation tax (paid) / received (134) 81 (156)
R&D tax received - 96 158
Net cash from operating activities 2,336 1,457 2,942
Cash flows from investing activities
Purchase of property, plant and equipment (30) (56) (61)
Disposal of plant and equipment 2 53 46
Disposal of intangible assets - 1,712 1,712
Capitalised development expenditure 6 (562) (810) (1,292)
Purchase of other intangible assets - (16) (16)
Interest received 62 212 329
Acquisition of subsidiaries net of cash (3,593) (4,170) (7,367)
Payment of deferred consideration (879) (369) (1,318)
Net cash from investing activities (5,000) (3,444) (7,967)
Cash flows from financing activities
Proceeds from loans - - 6,700
Repayment of loans (611) (181) (7,361)
Finance costs paid (373) (402) (913)
Capital payment of lease liabilities (78) (64) (132)
Interest payment of lease liabilities (26) (48) (84)
Net cash from financing activities (1,088) (695) (1,790)
Net decrease in cash and cash equivalents (3,752) (2,682) (6,815)
Exchange difference on cash and cash equivalents (16) (25) (10)
Cash and cash equivalents at start of period 8,566 15,391 15,391
Cash and cash equivalents at end of period 4,798 12,684 8,566
Notes
(forming part of the interim financial statements)
1 Basis of preparation
Software Circle plc (the "Company") is a company incorporated and domiciled in
the UK.
These financial statements do not include all information required for full
annual financial statements and should be read in conjunction with the
financial statements of the Company as at and for the year ended 31 March
2025. Those accounts have been reported on by the Company's auditors and
delivered to the Registrar of Companies. The report of the auditors was: (i)
unqualified; (ii) did not include a reference to any matters to which the
auditors drew attention by way of emphasis without qualifying their report;
and (iii) did not contain a statement under section 498 (2) or (3) of the
Companies Act 2006.
These interim financial statements are prepared on the same basis as the
financial statements for the year ended 31 March 2025, in which our full set
of accounting policies, including critical judgements and key sources of
estimation uncertainty, can be found.
As of the balance sheet date, the Company maintains a substantial cash
balance, providing a strong liquidity position to support its business
operations and strategic growth plans. The cash reserves are considered
sufficient to meet the current operational requirements and short-term
obligations of the Company.
The Company's primary strategic objective includes expansion through
acquisitions, which involves inherent risks, particularly concerning deferred
consideration payments. While the Company has a significant cash balance, the
Directors recognise the following risks:
● Acquisition Volume and Payment Obligations: The risk of
acquiring multiple companies in a short time frame could potentially strain
the Company's liquidity if not managed prudently.
● Deferred Consideration Payments: The Company must ensure that it
can meet deferred consideration payments as they fall due, without
compromising its operational liquidity.
To mitigate these risks, the Directors have implemented the following
measures:
● Due Diligence and Acquisition Strategy: Rigorous due diligence
processes are in place to evaluate potential acquisition targets, ensuring
that each acquisition aligns with the Company's strategic objectives and
financial capacity.
● Cash Flow Forecasting and Management: Detailed cash flow
forecasting is conducted regularly to project the timing and amounts of
deferred consideration payments, ensuring that adequate cash reserves are
maintained.
● Contingency Planning: Contingency plans are established to
address any potential shortfalls in liquidity, including securing additional
financing if necessary.
After considering the Company's strong cash position, the comprehensive risk
management strategies in place, and the ability to adjust the pace of
acquisitions if required, the Directors have a reasonable expectation that the
Company has adequate resources to continue in operational existence for the
foreseeable future. Accordingly, they continue to adopt the going concern
basis in preparing these interim financial statements.
These condensed consolidated interim financial statements were approved by the
Board of Directors on 24 November 2025.
2 Significant accounting policies
The accounting policies applied by the Company in these condensed consolidated
interim financial statements are the same as those applied by the Company in
its consolidated financial statements for the year ended 31 March 2025.
3 Segmental information
Segmental reporting is prepared for the Group's operating segments based on
the information which is presented to the Board, which reviews revenue and
adjusted EBITDA by segment. The Group's costs, finance income, tax charges,
non-current liabilities, net assets and capital expenditure are only reviewed
by the Board at a consolidated level and therefore have not been allocated
between segments in the analysis below.
Analysis by location of revenue
UK & Ireland
£000 Europe Other Total
£000 £000 £000
Six months ended 30 September 2025 9,905 43 246 10,194
Six months ended 30 September 2024 8,685 67 165 8,917
Year ended 31 March 2025 17,690 122 462 18,274
Revenue generated outside the UK & Ireland is in Belgium, The Netherlands,
France, New Zealand, South Africa and the USA. No single customer provided the
Group with over 1% of its revenue.
DISAGGREGATION OF REVENUE AND OPERATING PROFIT / (LOSS)
Period ended 30 September 2025 Graphics Professional & financial services Health & social
& Ecommerce care Operating Total Central overhead
Property Education Total
£000 £000 £000 £000 £000 £000 £'000 £000
Licence and subscription revenue 1,671 1,879 1,883 878 1,126 7,437 - 7,437
Product and service revenue 2,357 263 15 2 120 2,757 - 2,757
Revenue 4,028 2,142 1,898 880 1,246 10,194 - 10,194
adjusted EBITDA 472 793 756 394 694 3,109 (824) 2,285
Development costs 161 161 150 60 27 559 - 559
Share based payment charges - - - - - - (55) (55)
Acquisition costs - - - - - - (564) (564)
Depreciation and amortisation (408) (137) (153) (14) (17) (729) (2,237) (2,966)
Value adjustments on contingent consideration - - - - - - (107) (107)
Operating profit / (loss) 225 817 753 440 704 2,939 (3,787) (848)
Acquisition costs include directly related bonuses, stamp duty, legal and
professional fees and contingent consideration payments treated as a
compensation expense in line with IFRS 3 due to ongoing employment clauses.
Period ended 30 September 2024 Graphics Professional & financial services Health & social
& Ecommerce care Operating Total Central overhead
Property Education Total
£000 £000 £000 £000 £000 £000 £'000 £000
Licence and subscription revenue 1,722 1,269 1,553 791 614 5,949 - 5,949
Product and service revenue 2,818 120 28 2 - 2,968 - 2,968
Revenue 4,540 1,389 1,581 793 614 8,917 - 8,917
adjusted EBITDA 632 561 544 375 225 2,337 (745) 1,592
Development costs 299 140 330 41 - 810 - 810
Share based payment charges - - - - - - (52) (52)
Acquisition costs - - - - - - (299) (299)
Depreciation and amortisation (350) (122) (31) (15) (12) (530) (1,747) (2,277)
Exceptional items - - (51) - - (51) 1,712 1,661
Operating profit / (loss) 581 579 792 401 213 2,566 (1,131) 1,435
Exceptional items
On 2 April 2024, the Company announced the sale of the printing.com domain to
JAL Equity Corp for £1,772,000. Related disposal costs totalled £60,000.
£51,000 of restructuring costs were incurred in our Health & social care
division to enable the required reinvestment into development of the operating
unit's platform, future proofing and preparing that business for growth.
4 Finance expenses
Unaudited Unaudited Audited
Six months to Six months to Year ended
30 September 30 September 31 March
2025 2024 2025
£000 £000 £000
Lease interest 26 48 85
Bearer bond interest - 207 272
Loan interest 388 9 291
Facility fees 73 - 56
Foreign exchange losses / (gains) 158 (57) (54)
Unwinding of discount on deferred consideration 184 102 237
Total finance expense 829 309 887
5 Earnings per share
The calculations of earnings per share are based on the following profits and
numbers of shares:
Unaudited Unaudited Audited
Six months to Six months to Year ended
30 September 30 September 31 March
2025 2024 2025
£000 £000 £000
(Loss) / profit after taxation for the period (1,218) 1,245 (329)
Weighted average number of shares in issue 390,083,306 390,083,306 390,083,306
Dilutive effect of share options - 2,898,742 -
Weighted average shares in issue on a diluted basis 390,083,306 392,982,048 390,083,306
Basic earnings per share (0.31)p 0.32p (0.08)p
Diluted earnings per share (0.31)p 0.32p (0.08)p
Diluted earnings per share is calculated based on the treasury method
prescribed in IAS 33. This calculates the theoretical number of shares that
could be purchased at the average market price in the period from the proceeds
of exercised options. The difference between the number of shares under option
and the theoretical number of shares that could be purchased from the proceeds
of their exercise is deemed liable to be issued at nil value and represents
the dilution. Where the Group has reported a net loss after tax, including the
options would be anti-dilutive, therefore all outstanding options have no
dilutive effect.
6 Intangible assets
Domains Software Development Customer Technology Goodwill Other Total
& brand costs Lists
£000 £000 £000 £000 £0000 £000 £000 £000
Cost
Balance at 30 September 2024 363 4,560 7,336 7,658 13,443 5,931 139 39,430
Additions - internally developed - - 482 - - - - 482
Addition through subsidiary acquisition - - - 303 1,080 3,855 - 5,238
Disposals (337) (251) - (279) - - - (867)
Balance at 31 March 2025 26 4,309 7,818 7,682 14,523 9,786 139 44,283
Additions - internally developed
- - 562 - - - - 562
Addition through subsidiary acquisition (note 11) - - - 2,673 1,364 2,222 - 6,259
Balance at 30 September 2025 26 4,309 8,380 10,355 15,887 12,008 139 51,104
Amortisation and impairment
Balance at 30 September 2024 350 4,540 5,373 1,523 4,267 12 114 16,179
Amortisation - 1 158 351 1,598 - 1 2,109
Disposals (337) (251) - (279) - - - (867)
Balance at 31 March 2025 13 4,290 5,531 1,595 5,865 12 115 17,421
Amortisation 1 2 519 447 1,867 - 2 2,838
Balance at 30 September 2025 14 4,292 6,050 2,042 7,732 12 117 20,259
Net book value
At 30 September 2024 13 20 1,963 6,135 9,176 5,919 25 23,251
At 31 March 2025 13 19 2,287 6,087 8,658 9,774 24 26,862
At 30 September 2025 12 17 2,330 8,313 8,155 11,996 22 30,845
7 Trade and other receivables
Unaudited Unaudited Audited
30 September 30 September 31 March
2025 2024 2025
£000 £000 £000
Trade receivables 1,853 2,440 1,748
Less provision for trade receivables (362) (610) (439)
Trade receivables net 1,491 1,830 1,309
Total financial assets other than cash and cash equivalents classified at 1,491 1,830 1,309
amortised cost
Corporation tax - - 96
Prepayments 395 312 260
Other receivables 391 480 216
Total other receivables 786 792 572
Total trade and other receivables 2,277 2,622 1,881
8 Trade and other payables
Unaudited Unaudited Audited
30 September 30 September 31 March
2025 2024 2025
£000 £000 £000
Trade payables 486 599 504
Accruals 306 613 438
Other liabilities 1,363 1,277 1,408
Current financial liabilities measured at amortised cost 2,155 2,489 2,350
Deferred Income 2,072 1,815 1,480
Total trade and other payables 4,227 4,304 3,830
9 Other interest-bearing loans and borrowings
Unaudited Unaudited Audited
30 September 30 September 31 March
Current liabilities 2025 2024 2025
£000 £000 £000
Lease liabilities 156 83 159
Bearer bonds - 5,905 -
Loans 521 177 634
Deferred consideration 1,687 1,892 1,634
Contingent consideration 1,821 - 265
4,185 8,057 2,692
Non-current liabilities
Lease liabilities 424 769 499
Loans 5,267 - 5,678
Contingent consideration 1,992 1,479 1,931
7,683 2,248 8,108
10 Dividend
The Directors have not declared an Interim Dividend (2024: Nil).
11 Acquisitions
Acquisition of Artificial Intelligence Finance Limited (AIF)
Approximately 95% of the issued share capital of AIF, a provider of software
to mortgage and insurance brokers, was acquired on 4 August 2025 for total
consideration of up to €9,000,000. The initial consideration paid at
completion was €4,330,000, with deferred consideration of €670,000 to be
paid on the first anniversary of completion. Up to a further €4,000,000 is
payable to acquire the remaining 5% of AIF's share capital through a put and
call option, with the price payable being contingent upon the achievement of
certain targets relating to the future financial performance of AIF for
calendar years 2026 and 2027. The nature of the put and call option means that
the instrument is highly likely to be exercised. Due to this, management has
determined that it holds a present ownership interest in the remaining 5% of
the issued share capital. As a result, Non-Controlling Interest has not been
recognised, instead the consideration transferred includes the present value
of the expected amount payable upon exercise of the put and call option. In
addition, the consideration was increased by a further €449,000 in respect
of surplus cash within the business on completion, €149,000 of which was
paid on completion with the remainder deferred until the agreement of
completion accounts. The present value of expected consideration payments at
acquisition totalled £6,181,000.
AIF met Software Circle's acquisition criteria by being a software business,
by having a prominent position in its vertical market and by delivering
solutions that generate revenues of a recurring nature.
For the period that AIF was owned by the Group during the period under review,
it contributed revenue of £360,000, an aEBITDA of £99,000 and, due to the
amortisation of intangibles arising on consolidation, a loss before tax of
£14,000.
Net assets of AIF on acquisition:
Book Value Adjustments Fair value
£000 £000 £000
Customer lists - 2,673 2,673
Technology - 1,364 1,364
Development costs 449 (449) -
Property, plant and equipment 12 - 12
Investments in subsidiaries 1,279 (1,279) -
Cash and cash equivalents 329 - 329
Trade and other receivables 385 - 385
Trade and other payables (300) - (300)
Deferred tax - (504) (504)
Net assets acquired 2,154 1,805 3,959
Consideration 6,181
Goodwill 2,222
Consideration satisfied by: £000
Cash on completion 3,922
Deferred consideration 775
Contingent consideration 1,484
6,181
An income approach was used to value contractual customer lists and
relationships, using a discount factor of 13.4%. The useful life has been
estimated at 10 years. The technology was valued by using a relief from
royalty approach, based on a royalty rate of 21% and using a discount factor
of 13.4%. The useful life has been estimated at 3 years.
Investments in subsidiaries related to the previous acquisition of Lunar
Technologies Ltd by AIF and are eliminated on consolidation.
Trade and other receivables include gross contractual amounts due of £209,000
of which £nil was expected to be uncollectible at the date of acquisition.
The goodwill arising from the acquisition of AIF is attributable to a number
of factors, including the specialised knowledge and expertise of the assembled
workforce and the market position.
The deferred tax liabilities recognised represent the tax effect which will
result from the amortisation of the intangible assets, estimated using the tax
rate substantively enacted at the balance sheet date.
12 Post balance sheet events
On 13 October 2025, the Company announced the acquisition of the entire issued
share capital of Broker Information Services Limited (BIS), a provider of
client management and quotation software for the financial broker market in
Ireland. The total consideration of €8,250,000 is structured on a debt
free/cash free basis. The acquisition is expected to be cash flow generative
and earnings enhancing in the first year after acquisition. Initial
consideration of €6,900,000 was paid on completion, less a retention for
estimated net liabilities of €480,000. A further €1,350,000 of deferred
consideration will be paid on the first anniversary of completion. At the time
of issuing these financial statements, the completion accounts and intangible
asset valuations are ongoing. As a result, values relating to the valuation of
assets, intangible assets and goodwill arising on consolidation cannot yet be
disclosed.
The net initial consideration was funded partially through a £4.5m drawdown
from the Company's committed acquisition facility, with the remainder coming
from existing cash reserves.
Following the acquisition of BIS, the amount payable under the earnout for the
previously acquired AIF, as set out in note 11, has increased to a maximum of
€7,500,000, dependent on a now combined earnings target for AIF and BIS
across calendar years 2026 and 2027.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END IR FLFFTLDLSFIE
Copyright 2019 Regulatory News Service, all rights reservedRecent news on Software Circle
See all newsREG - Software Circle PLC - Director/PDMR Shareholding
AnnouncementREG - Software Circle PLC - Interim Results
AnnouncementREG - Software Circle PLC - Holding(s) in Company
AnnouncementREG - Software Circle PLC - Holding(s) in Company
AnnouncementREG - Software Circle PLC - Holding(s) in Company
Announcement