REG - Vianet Group PLC - Final Results
10/06/2025 07:00
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RNS Number : 0853M Vianet Group PLC 10 June 2025
Vianet Group plc
Unaudited Final Results for the year ended 31 March 2025
Strong Performance and Strategic Progress Across Divisions
Final Dividend increased.
Vianet Group plc (AIM: VNET), a leader in delivering actionable data and
business insights through an integrated ecosystem of hardware devices,
software platforms, and smart insights portals, announces its unaudited
results for the fiscal year ended 31 March 2025.
Financial Highlights:
· Revenue Growth: Total revenue increased to £15.27 million, up from
£15.18 million in FY24, highlighting the company's ability to drive sales
amidst evolving and yet challenging market conditions.
· Recurring Revenue: Recurring revenue reached £13.17 million,
representing 86% of total revenue, compared to £12.94 million (85% in FY24).
This robust performance underscores the stability and reliability of our
business model.
· Strong Gross Margin: The gross margin remained strong at 68.3%,
compared to 68.7% in the previous year, reflecting enhanced operational
efficiencies and cost control measures on recurring lines offsetting lower
hardware margins associated with our footprint expansion strategy.
· Increased Adjusted EBITA: Adjusted EBITA* rose by 3.6% to £3.59
million, compared to £3.47 million in FY24, due to effective management and
strategic execution.
· Profit Before Tax: Profit before tax stood at £0.93 million,
including a £0.25m R&D tax credit compared to £0.78 million in FY24,
supporting resilience in profit generation during a challenging economic
environment.
· Profit After Tax: Profit after tax was up 60% to £0.86m (FY24:
£0.54m)
· Strong Earnings Growth: Earnings Per Share (EPS) increased 61% to
2.92p compared to 1.81p in FY24.
· Final Dividend Increase: A final dividend of 1.00p is proposed,
marking a 33% increase from 0.75p in FY24. This brings the total annual
dividend to 1.3p up from 0.75p total dividend for FY24, highlighting our
confidence in future growth and commitment to shareholder returns.
· Significant Debt Reduction: Net debt has been reduced by 75% to
£0.38 million, down from £1.52 million in FY24, reinforcing our financial
stability and capacity for investment. It is worth noting that the cash
position is post increased dividends payments and after increased buybacks for
2024.
· Strong Cash Position: Year-end cash increased to £2.78 million,
compared to £1.82 million in FY24, providing a solid foundation for future
growth initiatives and strategic investments.
* Before exceptional items and share-based payments
Vianet's performance in the fiscal year ending 31 March 2025 underscores our
strategic focus and commitment to innovation. With a solid financial base,
growing recurring revenue, and a commitment to returning value to shareholders
through increased dividends, we are well-positioned for continued success in
the coming years. We look forward to leveraging our strengths and pursuing new
opportunities to drive further growth and deliver exceptional results.
James Dickson, Chairman of Vianet Group plc, commented:
"These solid results underscore our focus on delivering exceptional customer
value and position Vianet for sustained growth. Our unattended retail division
remains highly competitive, securing long-term contracts with strong recurring
revenue visibility and a valuable UK market share. The hospitality division
continues to deliver EBITA growth, with strategic investments in beverage
metrics, advanced reporting tools and key partnerships unlocking new markets
in the UK and US.
We have proactively navigated challenges, including supply chain pressures,
the 3G switch-off, and both economic and geopolitical uncertainties, while
achieving solid financial performance and strong momentum in both divisions.
Our unattended retail division secured 120 new contracts, driving higher value
cashless device growth, while the hospitality division secured renewals with
major clients like Greene King and Heineken. The current financial year has
started positively, and we are well-positioned to enter new verticals,
continue to drive subscription revenues, and deliver on our growth
objectives."
Divisional & Operational Highlights
Unattended Retail Division
· Adjusted Operating Profit £2.13m, down from £2.46m in FY24.
· Added 8,956 New Connected Machines (FY24: 8,900)
· Secured 120 new contracts, including renewals with WSH, The
Vending People, Compass, Rontec, and Wilcomatic in the fuel forecourt market.
· Strong recurring income underpinned by long term contracts allied
to a strong market position places the division in an enviable position.
Hospitality Division
· Revenue increased 4.7% to £9.02m from £8.62m in FY24.
· Operating Profit up 6.3% to £4.18m from £3.94m in FY24.
· Installation base stable at c 9,600 sites (FY24: 9,638), with 323
new installations offsetting unit closures in the sector.
· Secured long-term contract renewals with Greene King, Punch,
Heineken, Marstons, Trust Inns, and Red Oak.
· EBITA growth allied to strategic investments are unlocking new
markets both in the UK and the USA.
Investor Presentation
James Dickson, Chairman & CEO, and Mark Foster, CFO, will host a live
presentation on the financial results via the Investor Meet Company platform
on 10 June 2025 at 10:30 am GMT. The presentation is open to all shareholders,
with questions accepted pre-event via the Investor Meet Company dashboard
until 9 am the day before or during the live session.
Register at:
https://www.investormeetcompany.com/Pony-group-plc/register-investor
Enquiries:
Vianet Group plc
James Dickson, Chairman & CEO +44 (0) 1642 358 800 www.vianetplc.com
Mark Foster, CFO
Cavendish Capital Markets
Stephen Keys +44 (0) 207 220 0500 www.cavendish.com
Investor Enquiries:
Dale Bellis +44 (0) 207 397 1928 www.cavendish.com
CHAIRMAN'S STATEMENT
Introduction
After the investments that have been made in recent years, the Group is
well-positioned for both revenue and profit growth. Revenue increased to
£15.27m, with adjusted operating profit rising by 3.6% to £3.59m. Our focus
on revenue growth and profitability has enabled the Board to reinstate an
interim dividend and propose a 33% increase in the final dividend to 1.00p per
share.
Our hospitality division continues to deliver EBITA growth and secure
long-term contracts. Beverage Metrics Inc. is now firmly established, and
together with our key investment in advanced reporting, it is delivering an
exciting roadmap for the UK and USA hospitality sectors. This strategic
messaging is instrumental in securing contract renewals with existing
customers and enhancing customer engagement, as well as expanding our
commercial pipeline in new markets.
In the unattended retail sector, I am pleased to report significant progress
in securing long-term contracts with both new and existing customers. This
bodes well for sustained growth in recurring income as these customers
gradually achieve estate-wide connectivity. We are competitive having
successfully secured 120 new long-term contracts with strong recurring revenue
visibility, despite sector challenges stemming from the transition from 3G to
4G and customer estate rationalisation where our solutions have proven
valuable in helping customers identify unprofitable machine sites.
Furthermore, our expansion into the fuel forecourt market, coupled with
improved financing terms from HSBC, highlights our adaptability and financial
strength. The Board remains confident in our ability to sustain momentum,
deliver growth, and support progressive dividends.
Dividend
Strong customer engagement and commercial momentum underpin our confidence in
recurring revenue growth and cash generation for FY26, with a projected
positive net cash position. The Board recognises the significance of dividends
for shareholders and, in support of a progressive policy, proposes a dividend
of 1p per share, payable on 1 August 2025 to shareholders on the register on
20 June 2025.
Board and Staff
At present, I will continue to serve as the acting CEO to sustain our
commercial momentum, enhance customer conversions in the US, and explore
strategic initiatives aimed at maximising shareholder value.
Mark Foster, who has dedicated almost two decades to the role of CFO, will
step down prior to the AGM on July 16, 2025. He will be succeeded by Sarah
Bentham, our Finance Director, while Mark will remain available to Vianet for
a period as a consultant to facilitate a smooth transition. I would like to
take this opportunity to express my heartfelt gratitude for Mark's hard work
and unwavering devotion to Vianet and our shareholders throughout his tenure.
Our outstanding team consistently displays their enthusiasm, dedication, and
collaboration, which are key to Vianet's strong reputation. I appreciate the
invaluable contributions of our executive team, employees, and Board in
driving our continued success.
Conclusion and Outlook
FY25 marked another significant year of progress in securing long-term
customer commitments across both divisions, setting the stage for future
growth in recurring revenue and cash generation. Our innovative solutions,
strategic partnerships, and reputation as a trusted advisor and partner have
fostered excellent customer engagement, providing a solid foundation for
expansion, and an increasing number of growth opportunities.
· Unattended Retail: Our emphasis on connected devices and
market-leading transaction rates has resulted in a robust sales pipeline,
culminating in 120 new contracts. This positions us well for continued growth
in FY26 and FY27.
· Hospitality: Beverage Metrics has bolstered our growth in the UK and
is increasingly well-positioned to establish a profitable presence in the US
market. We are building a growing pipeline of installations and commercial
contracts anticipated in FY26 and beyond.
· New Verticals: Our investments in cloud infrastructure and mobile
technology, along with strategic partnerships in fuel forecourts and food
service, are set to drive scalability and revenue growth.
With a strong base of recurring revenue and robust cash flow, the Board is
confident in our ability to deliver earnings growth and expand strategic
options in FY26 and beyond.
James Dickson
Chairman
10 June 2025
STRATEGIC REPORT
We are pleased to report that we have successfully met our revised market
expectations for FY25, as highlighted in our January 2025 trading update. Our
achievements in key financial metrics - revenue, EBITA, EBITDA, cash
generation, and net debt reduction - underscores our strategic focus and
operational resilience in a challenging economic landscape.
Market Positioning and Strategy
Both divisions of our business have secured long-term contracts with a mix of
existing and new customers, reaffirming our competitive edge and adaptability.
In the unattended retail sector, we strategically shifted our focus towards
enhancing device sales and expanding our installation footprint. This pivot
involved a deliberate step back from vending management ERP software, allowing
us to concentrate on refining our SmartVend service module. This module now
offers simplified access to key sales data, alerts, and alarms, improving our
customer engagement and operational efficiency.
Our commitment to competitive pricing and market-leading transaction rates,
together with outstanding customer support, has resulted in the acquisition of
120 new contracts, developing a robust sales pipeline that continues to
support recurring revenue growth. Additionally, we have successfully completed
third-party integrations that facilitate seamless data transfer from our
cashless and telemetry devices. This capacity for data delivery from our
devices to various vending management ERP platforms improves our market access
and reinforces our reputation as trusted advisors, whilst driving significant
sales growth.
Growth Opportunities
Looking ahead, we identify further cashless and telemetry opportunities,
particularly in emerging marketplaces such as fuel forecourts, where we have
established a foundation of over 2,000 devices. This growth potential aligns
with our strategic intent to capitalise on the expanding demand for cashless
solutions.
In our hospitality division, bolstered by the integration of Beverage Metrics,
we are committed to delivering comprehensive beverage management solutions.
Our efforts have delivered growth in the UK, and we are strategically
positioning ourselves to penetrate the US market further. While ongoing
investment will be necessary during FY26, we are optimistic about converting
pilot programs into profitable commercial contracts within the fiscal year.
This conversion will accelerate our hospitality development roadmap, enabling
us to expand profitably in both the US and UK markets beyond our established
leased and tenanted customer base, who continue to be loyal users of our
innovative solutions.
Conclusion
In summary, our strategic initiatives have not only met but exceeded
expectations, positioning us favourably for continued growth and success. By
focusing on innovation, customer-centric solutions, and market expansion, we
are well-equipped to navigate the future and capitalise on new opportunities
in both the unattended retail and hospitality sectors.
OPERATING REVIEW
Unattended Retail Division
· Revenue: £6.25m (FY24: £6.56m).
· Operating Profit: £2.13m (FY24: £2.46m).
· New Connected Machines: 8,956 (FY24: 8,900), with a year-end
estate of 35,955 (FY24: 36,083).
· Recurring Revenue: Increased to 75.3% of turnover (FY24: 74%).
Our proactive response to the MNO 3G switch-off has played a crucial role in
supporting our customers' transition to 4G LTE connectivity. By providing
transparency in machine performance, we have empowered vending operators to
assess the profitability of their machines and locations, facilitating a
rationalisation of their estates. While this rationalisation, combined with
the short-term impact of reduced ERP revenue and a higher proportion of rental
sales, has led to a slight year-on-year decline in revenue and profitability,
we are confident of a rebound in FY26.
Growth Outlook:
Looking ahead, we anticipate a resurgence in both revenue and profitability as
we capitalise on a full year of our recurring revenue footprint and benefit
from over 120 new long-term customer contracts, each with a minimum three-year
term. The robust nature of this pipeline means we are well-positioned to
support our growth plans moving forward.
Our cashless payment solutions are supported by partnerships with industry
leaders, including Elavon, Worldpay, NMI, and Attenda, which are further
enhanced by our PCI Master Merchant service. Our solutions significantly
improve machine uptime, utilisation, and sales performance for our customers,
delivering advantages such as reduced cash handling costs, enhanced cash flow,
and assured payment collections.
Market Potential:
The addressable market presents significant opportunities, with over 300,000
vending machines in the UK and approximately three million across Europe, of
which less than 50% are currently equipped with any form of connectivity. This
underscores the vast potential for growth as we continue to innovate and
expand our connected solutions.
In summary, while we faced challenges in the past year, our strategic
initiatives and market positioning are set to drive future success, enabling
us to leverage our established customer relationships and capitalise on the
growing demand for cashless solutions in the unattended retail sector.
Hospitality Division
· Revenue: £9.02m (FY24: £8.62m).
· Recurring Revenue: Remained strong at 94% (FY24: 94%)
· Operating Profit: £4.18m (FY24: £3.94m).
In FY25, new installation sales increased to 323 new sites (compared to 260
sites in FY24). This growth was supported by four new contract wins and five
contract renewals, including three long-term customers, driven by an
increasing demand for data and insights.
Our UK pub installation base saw 361 disposals and temporary closures (FY24:
454), which, alongside the new installations, resulted in a net reduction of
38 UK installations. This brings the total installed UK and USA base to
approximately 9,600 sites (FY24: 9,638).
Predicting pub closures and openings remains challenging, particularly as the
profitability threshold for managed venues continues to rise. This trend is
resulting in more managed pubs migrating to leased and tenanted models, where
the hurdle rate for profitability is lower.
Our BMI software solutions have significantly enhanced commercial engagement
in both the UK and US hospitality sectors, unlocking new opportunities,
particularly in the US, where strong growth is anticipated in FY26. The demand
for brand and market data insights is on the rise, bolstered by the launches
of the BMI and Smart Insights portals.
Our partnership with the Oxford Partnership is delivering innovative,
consumer-level insights for beer brands, with further growth expected in FY26.
Additionally, incorporating compliance services and data analytics into our
BMI assets is enhancing operational and retail performance, especially for
private equity-owned pubs, thereby maximising their return potential.
Vianet Americas Inc (VAI)
VAI reported a pre-amortisation loss of £385k for FY25, slightly improved
from £387k in FY24. This loss reflects our ongoing investment strategy aimed
at maximising our full potential and capitalising on the commercial
opportunities that lie ahead. The integration of Vianet's draught monitoring
into the Beverage Metrics inventory platform provides a comprehensive drinks
management solution, enabling operators to reduce costs, enhance productivity,
and maximise sales, driving profitability across the entire drinks category.
This strategic proposition firmly positions Vianet's hospitality operations
for growth in the UK while paving the way for a profitable presence in the US,
where we benefit from direct access to most national retail chains. The US
market, being the largest operator market globally, presents significant
opportunities, with several advanced-stage conversations and commercial
prospects underway.
While further investment in our US operations will be necessary, we anticipate
strong commercial traction in FY26, with expectations for a significant
reduction in losses by year-end. We remain committed to establishing a
substantial profit centre in the US, positioning Vianet for long-term success
in this key market.
R&D Investment
R&D investment is essential for maintaining the Group's market position,
and we continue to invest in executing our product roadmap and enhancing
operational capabilities.
· SmartVend: Enhanced device and asset management.
· Beverage Metrics: Improved features and reduced hardware and
support costs.
· SmartInsight: Launched market insight portal.
· Hardware Development: Adapted technology for new verticals,
improving speed and latency.
Further unattended retail product enhancements, leveraging of BMI products and
services, and securing new market verticals for telemetry and cashless
payments on a cloud-based platform will further boost our services to
customers in existing and new verticals.
The Board believes that the investment in data capture technology, our core
data management capability, and management software platforms will continue to
deliver growth and enhance the quality and visibility of our recurring revenue
streams.
Looking Forward
Vianet has a strong growth trajectory, leveraging its momentum to capitalise
on opportunities in remote asset management, cashless payments, and market
data insights across core and new markets. BMI's end-to-end product suite has
enabled deeper C-suite engagement in the UK and US, supporting expansion in
hospitality operations.
Our SmartVend platform reinforces our leadership in device asset management,
with a highly motivated sales team driving conversions in the UK and Europe's
3 million+ vending machine market. New customer acquisitions (120 onboarded
this year) have boosted machine sales, exceeding prior-year performance
despite customer estate rationalisation.
The Hospitality division has a robust sales pipeline in the UK leased and
tenanted sector, powered by our advanced data capabilities. FY26 system sales
are expected to offset pub closures and expand our core estate. The
combination of BMI's inventory platform and draught beer monitoring delivers a
comprehensive beverage management solution, unlocking stock optimisation,
analytics, and commercial insights. This positions us for growth across UK
pubs and increasing traction in the US, where private equity ownership drives
a sharper focus on commercial performance-an area where we add significant
value.
Our partnership with Attenda has helped establish a presence of over 2,000
devices in fuel forecourts, creating an excellent platform for further
expansion into catering and forecourt solutions.
While not immune to global geopolitical pressures and domestic fiscal
challenges affecting our customers in this difficult economic climate, Vianet
remains well-positioned for continued growth. We anticipate that rising demand
for our mission-critical solutions will drive:
· Sustained revenue expansion
· High-quality recurring income (86% of total)
· Strong cash flow generation
· A transition from net debt to net cash during FY26
Our ongoing investments in product innovation and talent development are
generating significant momentum. The Group has confidence in our team's
abilities, market-leading solutions, and financial strength, which will enable
us to achieve consistent business growth.
The Board remains committed to our long-term strategy, which will:
· Accelerate sales momentum.
· Deliver sustainable earnings growth.
· Enhance profitability.
Supported by our exceptional team, proven strategy, and clear earnings
visibility, we are well-positioned to profitably expand our IoT presence. Our
advanced data and insight solutions empower customers to optimise asset
performance and drive transformational business outcomes.
James Dickson
Chairman and Chief Executive
FINANCIAL REVIEW
Financial Performance
The Group's operating profit before exceptional items, amortisation, and
share-based payments increased to £3.59m in FY25, up from £3.47m in FY24,
reflecting a year-on-year growth of approximately 3.6%. Our gross margin
remained strong at 68.3%, compared to 68.7% in the previous year, highlighting
the benefits derived from ongoing higher-margin recurring revenues and
operational efficiency improvements, which offset our hardware pricing
strategy.
Revenue & Recurring Revenue
Total revenue grew by 0.6% to £15.27m, slightly up from £15.18m in FY24.
This growth was primarily driven by an increase in the Hospitality division,
although it was partially offset by a slower performance in the Unattended
Retail division, as detailed in the Operating Report. The Group's contracted
recurring revenue base is strong and was further bolstered by several new 3 to
5-year contracts secured across both divisions with both new and existing
customers.
Consolidated recurring revenue now accounts for 86.3% of total revenue, up
from 85.2% in FY24. This increase in recurring revenue was supported by higher
rental income in the Unattended Retail division, which effectively offset the
higher capital expenditure sales in the Hospitality division.
Performance Summary
Metric FY25 FY24 Change
Revenue £15.27m £15.18m +0.6%
Operating profit ((a)) £3.59m £3.47m +3.6%
Profit before tax((d)) £0.93m £0.78m +18.4%
EBITDA ((b)) £4.14m £4.01m +3.1%
Basic EPS((c)) 2.92p 1.81p +61.3%
Dividend per share 1.00p 0.75p +33.3%
Net debt £0.38m £1.52m -74.9%
a) Pre-exceptional items, amortisation, and share-based payments.
b) Pre-exceptional EBITDA.
c) See EPS note below.
d) Including a £0.25m R&D tax credit as defined as other income.
Exceptional Items
Item FY25 (£000) FY24 (£000)
People and office rationalisation 64 65
3G network obsolescence costs 15 25
Corporate activity and BMI acquisition costs 118 346
Recovered corporate costs (5) (350)
Bank refinance costs - 59
Total 192 145
Corporate activity and acquisition costs represent advisor fees related to
potential acquisitions and strategic reviews. FY24 included the recovery of
costs related to a historic matter under confidentiality.
Overall, the financial performance reflects a mixed but stable outlook, with
revenue growth and improved operating profit, alongside a significant
reduction in net debt. The increase in dividend per share demonstrates our
commitment to returning value to shareholders while navigating the challenges
reflected in profit before tax.
Dividend Announcement
As highlighted in the Chairman's statement, the Board proposes a final
dividend of 1.00p per share, an increase from last year's 0.75p per share.
Cash Performance
Cash generated before working capital movements reached £3.98m for the year,
compared to £3.93 million in FY24. This represents 110.6% of pre-exceptional
EBITA and 102.9% of EBITDA (96.1% pre-exceptional). Positive working capital
management contributed to a £0.64m inflow, a significant improvement from a
£0.26m outflow in FY24. Consequently, post-working capital cash generation
rose to £4.61m, up 25.7% year-on-year, compared to £3.67m in FY24 (excluding
a £0.92m tax rebate).
Cash Deployment
The generated cash has been strategically deployed towards various
initiatives, including R&D investment, recurring rental assets, lease
costs associated with refreshing the vehicle fleet, and an increase in both
dividend and share buybacks. After these expenditures, the Group recorded a
net cash inflow of £0.96m, compared to a net outflow of £2.92m for FY2024,
which included a tax rebate and a £1.1m refinancing inflow.
Year-End Financial Position
As of year-end, cash reserves stood at £2.78m, an increase from £1.82m in
FY24. Additionally, net debt was reduced to £0.38m, down from £1.52m in
FY24. The Group aims to transition to a net cash position by FY2026.
Outlook
The robust results and improved cash position, along with the positive
momentum discussed in the Chair and CEO reports, reinforce our confidence in
the Group's strategic direction and growth ambitions.
Divisional Performance
Unattended Retail Division
This division delivers cashless payment, telemetry, and connectivity solutions
primarily across vending, coffee-to-go, and fuel forecourts.
Metric FY25 FY24
Turnover £6.25m £6.56m
Operating profit* £2.13m £2.46m
New telemetry machines 1,442 3,644
New cashless machines 7,514 5,256
*Pre-exceptional items, share-based payments, and amortisation on a continuing
basis.
Recurring revenues accounted for approximately 75% of turnover, up from 74% in
FY24, highlighting robust year-on-year growth and an increasing share of new
rental units. Our machine estate has remained stable, reflecting our strategic
emphasis on asset management and estate optimisation during the transition
from 3G to 4G LTE technology. While operating profit saw a slight adjustment
to £2.13m compared to £2.46m in FY24, this reflects our commitment to
long-term sustainability and growth.
Hospitality Division
This division provides beverage and inventory monitoring services, as well as
data insights and business services, across all geographies.
Metric FY25 FY24
Turnover £9.02m £8.62m
Operating profit (a) £4.18m £3.94m
New site installations 323 260
Year-end estate (b) 9,600 9,638
a) Pre-exceptional items, share-based payments, and amortisation.
b) UK, USA, and Europe.
Recurring revenue remained robust at 94% of turnover, consistent with FY24.
The division showcased impressive performance, bolstered by growth in new
venue sales and sustained strength in recurring revenue streams, alongside a
notable slowdown in pub disposals. The expansion into US venues further
fuelled revenue growth, highlighting strong customer engagement and the
resilience of our revenue model. By year-end, our estate included
approximately 9,600 sites across the UK, USA, and Europe, a slight decrease
from 9,638 in FY24, reflecting our strategic focus. Additionally, Smart Zones'
operating profit increased by an impressive 6.3% to £4.18m, up from £3.94m
in FY24, proving our commitment to profitability and growth.
Taxation
The tax charge arises from a combination of tax due in the year and movements
in deferred tax for current and prior years. Approximately £1.5m of Group
losses will continue to be utilised for relief in FY26.
Earnings per Share
Basic EPS was 2.92p compared to FY24 restated 1.81p. Further information on
the tax restatement can be found in Note 8.
Balance Sheet and Cash Flow
The Group's balance sheet remains robust and strategically positioned to
support our growth ambitions, further strengthened by increased cash reserves
and a significant reduction in net debt. Operating cash flow before working
capital movements rose to £3.98m, up from £3.93m in FY24, reflecting a
year-on-year growth of 1.2%. A favourable working capital movement of £0.64m,
driven by lower debtors and stock levels, contributed to a total net cash
inflow of £4.61m, compared to £3.67m in FY24 (excluding the tax rebate).
This cash influx has been strategically used for investing in technology
development, acquiring additional rental assets, lease costs associated with
refreshing our vehicle fleet, reducing borrowings, and enhancing shareholder
returns through dividends and share buybacks. By year-end, total borrowings
decreased to £3.16m from £3.34m in FY24 and included an extended revolving
credit facility (RCF) to April 2028, term loan, and mortgage. Notably, net
debt was reduced to £0.38m from £1.52m in FY24.
The Group's strong cash generation and resilient balance sheet provide a solid
foundation to build upon the progress made in FY25 and to pursue significant
growth opportunities ahead.
Mark Foster
Chief Financial Officer
Consolidated Statement of Comprehensive Income for the year ended 31 March
2025
Total As Restated Exceptional 2024 As Restated
Before Exceptional 2025 Before Exceptional 2024 £000 Total
2025 Exceptional 2025 £000 £000 2024
£000 £000 £000
Note
Continuing operations
Gross Revenue
15,266 - 15,266 15,176 - 15,176
Rebates (242) - (242) (260) - (260)
Net Revenue 15,024 - 15,024 14,916 - 14,916
Revenue 15,024 - 15,024 14,916 - 14,916
Cost of sales (4,603) - (4,603) (4,485) - (4,485)
Gross profit 10,421 - 10,421 10,431 - 10,431
Administration and other operating expenses (6,827) (192) (7,019) (6,962) (145) (7,107)
Operating profit pre amortisation and share based payments 3,594 (192) 3,402 3,469 (145) 3,324
Intangible asset amortisation (2,292) - (2,292) (2,164) - (2,164)
Share based payments (79) - (79) (100) - (100)
Total administrative expenses (9,198) (192) (9,390) (9,226) (145) (9,371)
Operating Profit 1,223 (192) 1,031 1,205 (145) 1,060
Net finance costs (349) - (349) (276) - (276)
Other income 247 - 247 - - -
Profit before tax 1,121 (192) 929 929 (145) 784
Income tax charge 1 (72) - (72) (249) - (249)
Profit and other comprehensive income for the year
1,049 (192) 857 680 (145) 535
Earnings per share
Total
- Basic 3 2.92p 1.81p
- Diluted 3 2.86p 1.80p
Consolidated Balance Sheet at 31 March 2025
2025 As Restated
£000 2024
£000
Assets
Non-current assets
Goodwill 17,856 17,856
Other intangible assets 5,253 5,884
Property, plant and equipment 3,379 3,327
Total non-current assets 26,488 27,067
Current assets
Inventories 1,503 2,185
Trade and other receivables 3,242 3,873
Cash and cash equivalents 2,777 1,822
7,522 7,880
Total assets 34,010 34,947
Equity and liabilities
Liabilities
Current liabilities
Trade and other payables 2,329 3,061
Leases 110 123
Borrowings 185 177
2,624 3,361
Non-current liabilities
Leases 47 157
Borrowings 2,974 3,159
Deferred tax liability 901 1,076
Contingent consideration 322 268
4,244 4,660
Equity attributable to owners of the parent
Share capital 2,900 2,940
Share premium account 11,770 11,748
Capital redemption reserve 75 32
Share based payment reserve 655 583
Merger reserve 818 818
Retained profit 10,924 10,805
Total equity 27,142 26,926
Total equity and liabilities 34,010 34,947
Consolidated Statement of Changes in Equity for the year ended 31 March 2025
Share capital Share premium Share Retained profit Total
account based
payment Capital Redemption Reserve
reserve Merger
reserve
At 1 April 2023 2,880 11,711 563 310 15 10,488 25,967
Share based payments - - 100 - - - 100
Share option forfeitures - - (80) - - 80 -
Dividends - - - - - (148) (148)
Share capital issued 77 37 - 508 - - 622
Shares cancelled (17) 17 (150) (150)
Transactions with owners 60 37 20 508 17 (218) 424
Profit and total comprehensive income for the year - - - - - 801 801
Total comprehensive income less owners transactions 60 37 20 508 17 583 1,225
At 31 March 2024 2,940 11,748 583 818 32 11,071 27,192
At 1 April 2024 (as previously stated) 2,940 11,748 583 818 32 11,071 27,192
Prior year adjustment (Note 8) - - - - - (266) (266)
At 1 April 2024 (as restated) 2,940 11,748 583 818 32 10,805 26,926
Share based payments - - 79 - - - 79
Share option forfeitures - - (7) - - 7 -
Dividends - - - - - (309) (309)
Share capital issued 3 22 - - - - 25
Shares cancelled (43) 43 (436) (436)
Transactions with owners (40) 22 72 - 43 (738) (641)
Profit and total comprehensive income for the year - - - - - 857 857
Total comprehensive income less owners transactions (40) 22 72 - 43 119 216
At 31 March 2025 2,900 11,770 655 818 75 10,924 27,142
Consolidated Cash Flow Statement for the year ended 31 March 2025
Note 2025 As Restated
£000 2024
£000
Cash flows from operating activities
Profit for the year 857 535
Adjustments for
Net interest payable 349 276
Income tax charge 72 249
R&D tax credit (Other income) (247) -
Amortisation of intangible assets 2,292 2,164
Depreciation 541 544
Loss on impairment of property, plant and equipment and businesses 32 61
Share based payments 79 100
Operating cash flows before changes in working capital and provisions 3,975 3,929
Change in inventories 683 91
Change in receivables 631 (996)
Change in payables (678) 646
636 (259)
Cash generated from operations 4,611 3,670
Income Taxes refunded - 922
Net cash generated from operating activities 4,611 4,592
Cash flows from investing activities
Purchases of property, plant and equipment (625) (577)
Capitalisation of development costs (1,657) (1,724)
Purchases of intangible assets (4) (8)
Net cash used in investing activities (2,286) (2,309)
Cash flows from financing activities
Net interest payable (349) (276)
Repayment of leases (123) (84)
Issue of share capital 25 44
New leases - 190
Shares Purchased and cancellation (436) (150)
Dividends paid (309) (148)
New borrowings - 3,440
Repayments of borrowings (178) (2,378)
Net cash (used)/received in financing activities (1,370) 638
Net increase in cash and cash equivalents 955 2,921
Cash and cash equivalents at beginning of year 1,822 (1,099)
Cash and cash equivalents at end of year 2,777 1,822
Notes to the financial statements
1. Taxation
Analysis of tax charge in year
2025 As Restated
£000 2024
£000
Current tax expense
- Amounts in respect of the current year 247 -
- Amounts in respect of prior periods - -
247 -
Deferred tax charge:
- Amounts in respect of the current year (246) 184
- Amounts in respect of prior periods 71 65
Income tax charge 72 249
Reconciliation of effective tax rate
The tax for the 2025 year is higher (2024: was lower) than the standard rate
of corporation tax in the UK (2024: 25%). The differences are explained below:
2025 As Restated
£000 2024
£000
Profit before taxation 929 784
- Continuing operations
Profit before taxation multiplied by rate of corporation tax in the UK of 25% 232 196
(2024: 25%)
Effects of:
Other expenses not deductible for tax purposes (92) 26
Non-taxable income - (111)
Deferred tax provided for (378) -
Gains not provided for 188 380
Adjustments for prior years 71 65
Amortisation of intangible assets, Research and Development 51 (307)
Total tax charge 72 249
2. Ordinary dividends
2025 2024
£000 £000
Final dividend for the year ended 31 March 2024 of 0.75p (year ended 31 March 221 148
2023: 0.50p)
Interim dividend paid in respect of the year of 0.30p (2024: nil) 88 -
Amounts recognised as distributions to equity holders 309 148
In addition, the directors are proposing a final dividend in respect of the
year ended 31 March 2025 of 1.00p per share payable on 1 August 2025 to
shareholders on the register on 20 June 2025. Total dividend payable 1.30p
(2024: 0.75p).
3. Earnings per share
Earnings per share for the year ended 31 March 2025 was 2.92p (2024: 1.81p).
Basic earnings per share are calculated by dividing the earnings attributable
to ordinary shareholders being a profit of £857k (2024: £535k) by the
weighted average number of ordinary shares outstanding during the year.
Diluted earnings per share are calculated on the basis of profit for the year
after tax divided by the weighted average number of shares in issue in the
year plus the weighted average number of shares which would be issued if all
the options granted were exercised.
2025 As Restated
2024
Earnings Basic earnings per share Diluted earnings per share Earnings Basic earnings per share Diluted earnings per share
£000 £000
Post-tax profit attributable to equity shareholders 857 2.92p 2.86p 535 1.81p 1.80p
2025 2024
Number Number
Weighted average number of ordinary 29,329,080 29,493,637
shares
Dilutive effect of share options 596,339 250,533
Diluted weighted average number of ordinary shares 29,925,419 29,744,170
4. Exceptional items
2025 2024
£000 £000
Corporate activity 118 346
Recovered corporate costs (5) (350)
Staff transitional costs 64 65
3G Project (4G swap) 15 25
Bank refinance costs - 59
192 145
Corporate activity costs relate to fees paid to corporate advisors in respect
of prospective corporate evaluations. During FY24 the company recovered costs
associated with a previous historic matter that is the subject of a
Confidentiality Agreement.
Staff transitional costs relate to the transition of people and management to
ensure we have to succession and calibre of people on board to deliver the
strategic aims and aspirations of the Group.
5. Basis of preparation
In accordance with the Companies Act 2006, this preliminary report is based on
the unaudited financial statements and has been prepared and approved by the
Directors in accordance with UK adopted international accounting standards,
and in accordance with the AIM rules and is not therefore in full compliance
with IFRS. The company prepares its parent company financial statements in
accordance with FRS 101.
The financial information for the year ended 31 March 2024 does not constitute
statutory accounts as defined in section 434 of the Companies Act 2006. A copy
of the statutory accounts for that year has been delivered to the Registrar of
Companies. The independent auditors' report on the full financial statements
for the year ended 31 March 2024 was unqualified and did not contain an
emphasis of matter paragraph or any statement under section 498 of the
Companies Act 2006. This preliminary announcement does not constitute the
Group's full financial statements for the year ended 31 March 2024.
The Group's full financial statements will be approved by the Board of
Directors and reported on by the auditors on 19 June 2025. Accordingly, the
financial information for the year ended 31 March 2025 is presented unaudited
in the preliminary announcement.
The consolidated financial statements have been prepared on an historical cost
basis, except for derivative financial instruments that have been measured at
fair value. The consolidated financial statements are presented in pounds
sterling, and all values are rounded to the nearest hundred thousand,
expressed in millions to one decimal point, except when otherwise indicated.
The Directors have prepared this financial information on the fundamental
assumption that the Group is a going concern and will continue to trade for at
least 12 months following the date of approval of the financial information.
In determining whether the Group's accounts should be prepared on a going
concern basis the Directors have considered the factors likely to affect
future performance.
6. Notes supporting statement of cashflows
Borrowings Borrowings Total
due within due after £000
one year one year
£000 £000
Net debt as 1 April 2023 (757) (1,517) (2,274)
Cash flows 580 (1,642) (1,062)
Non cash-flows
- Interest accruing in the year - - -
Net debt at 31 March 2024 (177) (3,159) (3,336)
Cash flows (8) 185 177
Non cash-flows
- Interest accruing in the year - - -
Net debt at 31 March 2025 (185) (2,974) (3,159)
Cash and cash equivalents for the purpose of the statement of cash flows
comprises
2025 2024
£000 £000
Cash at bank available on 2,777 1,822
demand
Cash on hand - -
Adjusted net cash generation 2,777 1,822
Non- cash transactions from financing activities are shown in the
reconciliation of liabilities from financing transactions in Note 6.
7. Alternative Performance Measures
In the reporting of financial information, the Directors have adopted the APMs
"Adjusted operating (loss)/profit", "Adjusted operating cash generation", and
"Adjusted net cash generation", (APMs were previously termed 'Non-GAAP
measures'), which is not defined or specified under International Financial
Reporting Standards (IFRS).
These measures are not defined by IFRS and therefore may not be directly
comparable with other companies' APMS, including those in the Group's
industry. APMs should be considered in addition to, and are not intended to be
a substitute for, or superior to, IFRS measurements.
Purpose
The Directors believe that these APMs assist in providing additional useful
information on the underlying trends, performance, and position of the Group.
These APMs are also used to enhance the comparability of information between
reporting periods and business units, by adjusting for non-recurring or
uncontrollable factors which affect IFRS measures, to aid the user in
understanding the Group's performance.
Consequently, APMs are used by the Directors and management for performance
analysis, planning, reporting and incentive setting purposes and this remains
consistent with the prior year. Adjusted APMs are used by the Group in order
to understand underlying performance and exclude items which distort
compatibility, as well as being consistent with public broker forecasts and
measures.
2025 2024
£000 £000
Operating profit (IFRS 1,031 1,060
measure)
Add back:
Amortisation charge 2,292 2,164
Share based payment charge 79 100
Exceptional items charge 192 145
Adjusted operating profit 3,594 3,469
8. Prior Year Adjustment
The Directors have identified an error in the prior year Corporation Tax
Charge and Deferred Tax Asset balances. In the prior period financial
statements, the tax charge was understated by £266,000 as a result of an
error made in the tax provision workings in respect of the deduction of
disallowable expenditure.
The following adjustments have been made to the prior period results.
As previous Adjustment Restated
£000 £000 £000
Income tax (credit)/charge (17) 266 249
Deferred Tax Asset 565 (266) 299
Furthermore, a correction was made to the consolidated cash flow statement to
correct the income tax credit line, along with the associated reduction in
profit. The above adjustments to the 31 March 2024 year reflect the position
as if this change has been made.
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