Sysgroup Share Discussion Threads

[5oletrader] 27/6/2019 08:14

For me... No one knows the accounts better than the Chief Financial Officer.

The fact he's just purchased 59,808 @ 41.8p (£25,000k) speaks volumes IMO.

[yump] 27/6/2019 08:06

Quite interested here but the large acquisition means a load of exceptionals in the next results which of course is always why companies start quoting Ebitda. So difficult to get a real value. On the other hand they are now post transition to a recurring revenue model, so the inevitable drop in profits should in theory be past.

[tiltonboy] 27/6/2019 07:57

A good note from SCAP yesterday:

Investment case. At 39p, SysGroup trades at 6.7x EV/EBITDA for FY2020F falling to 5.8x
for FY2021F and a current year FCF yield of c. 8%. Executing to plan should create a
significant value uplift as results are delivered.

Hopefully this isn't yet another false dawn!

[cpap man] 27/6/2019 07:00

Another RNS this morning from SYS....directors [plural] share purchases of SYS stock

[cpap man] 24/4/2019 07:25

SYS are far too cheap [undervalued] in my book! Re-rating on the cards for SYS?

[cpap man] 24/4/2019 06:55

24 April 2019

SysGroup plc

("SysGroup" or the "Group")

Trading Update and Notice of Results

SysGroup (AIM:SYS), the award-winning managed IT services and cloud hosting provider, is pleased to provide a trading update for the year ended 31 March 2019, together with a notice of results.

Group trading performance
The Group is pleased to report that both revenue and adjusted EBITDA will be in line with management's expectations having grown by approximately 22% and 40% respectively since FY18. The results will underpin the Group's stated strategy of focusing on the provision of end-to-end Managed IT Services with recurring revenue now representing approximately 74% of the Group's total revenue.

The Group acquired Certus IT Limited ("Certus") towards the end of the period and is pleased to report that trading performance from Certus is in line with management's expectations. The process of integration is now underway, and we expect Certus to be trading under the SysGroup brand later in the year.

Notice of Results
SysGroup expects to publish its full year results for the year ended 31 March 2019 on 26 June 2019.

Adam Binks, Chief Executive of SysGroup commented:
"It has been an exciting first year at the helm of SysGroup, and I am pleased with the progress that we have made on our journey to become the leading provider of managed IT services and cloud hosting. We've spent a considerable amount of time getting to know our customers and understanding the challenges they face within their own businesses so that we can develop leading solutions that offer real value. I'm also delighted to have welcomed the Certus team on-board following the acquisition earlier this year. We will continue to invest in the Group and in our people throughout the course of FY20 and I am confident that we will see shareholder returns as a result."

[cpap man] 07/2/2019 12:30

Techmarket view:

AIM-listed managed services and cloud hosting provider, SysGroup, has acquired Newport-based Certus IT. SysGroup, which has made a placing of new ordinary shares to raise £10m, will pay an initial cash consideration of £8m, increasing to a maximum cash consideration of £9m (dependent on performance).

Certus has contracted future income of c£8.7m for the three years to end December 2021, and 40 members of staff.

Synergies between the pair are clear in terms of service offerings, geographical reach and customer bases. Bringing Certus into the fold also expands SysGroup’s Infrastructure-as-a-Service customer base and upgrades the Group to gold partner status with Dell EMC and Microsoft.

SysGroup had a good year in 2018 (see New CEO presides over record SysGroup revenue), and we believe the timing of the Certus acquisition looks good too.

[cpap man] 07/2/2019 12:25

Great news!

[aishah] 07/2/2019 11:58

Techmarket view:
AIM-listed managed services and cloud hosting provider, SysGroup, has acquired Newport-based Certus IT. SysGroup, which has made a placing of new ordinary shares to raise £10m, will pay an initial cash consideration of £8m, increasing to a maximum cash consideration of £9m (dependent on performance).

Certus has contracted future income of c£8.7m for the three years to end December 2021, and 40 members of staff.

Synergies between the pair are clear in terms of service offerings, geographical reach and customer bases. Bringing Certus into the fold also expands SysGroup’s Infrastructure-as-a-Service customer base and upgrades the Group to gold partner status with Dell EMC and Microsoft.

SysGroup had a good year in 2018 (see New CEO presides over record SysGroup revenue), and we believe the timing of the Certus acquisition looks good too.

[cpap man] 26/11/2018 10:55

SysGroup plc

("SysGroup" or the "Company" or the "Group")



Half yearly results for the six months ended 30 September 2018



SysGroup PLC (AIM: SYS), the Managed IT Services and Cloud Hosting provider, is pleased to announce its unaudited half year results for the six months ended 30 September 2018 (H1 2019).



Financial highlights

· Revenue increased 47.3% to £5.8m (H1 FY18: £3.9m)

· Recurring Managed IT Services represented 77.8% of total revenue (H1 FY18: 72.8%)

· Adjusted EBITDA1 increased 300% to £0.56m (H1 FY18: £0.14m)

· Adjusted profit2 before tax of £0.25m (H1 FY18: loss of £0.008m)

· Adjusted basic EPS3 of 1.1p (H1 FY18 0.2p)

· Loss before tax of £0.35m (H1 FY17: profit of £0.08m)

· Basic loss per share of 1.4p (H1 FY18: EPS 0.8p)

· Gross cash of £1.15m (H1 FY18: £2.69m; FY18: £1.32m)

· Net debt of £0.84m (H1 FY18: Net cash £2.41m; FY18 Net debt £0.92m)



1Adjusted EBITDA is earnings before interest, taxation, depreciation, amortisation of intangible assets, exceptional items, share based payments and fair value adjustments

2Adjusted profit before tax is profit before tax after adding back amortisation of intangible assets, exceptional items, fair value adjustments, and share based payments.

3Adjusted basic EPS is profit after tax after adding back amortisation of intangible assets, exceptional items, fair value adjustments, share based payments and associated tax.





Operational highlights

· Restructuring of Board complete with Martin Audcent appointed as CFO and retirement of Robert Khalastchy as Non-Executive Director

· 2nd Hyper-Scale Cloud Platform in London datacentre now servicing customers

· Implementation of Long Term Incentive Plan for executive management to deliver long-term value creation for shareholders and ensure alignment with shareholder interests

· Enhanced staff benefits to attract and retain the best talent in the business

· Refurbishment of Liverpool office complete and London office commenced



Post Period-end

· Won Security Vendor of the Year at Computing Security Excellence Awards



Adam Binks, Chief Executive Officer, commented:

"During the period we have focussed on execution and I am pleased to report that the Group has made steady progress in the first half of the year during my first period as CEO. The increasing proportion of recurring revenue demonstrates the ongoing success of our strategy and position as a consultative led provider of Managed IT Services and Cloud Hosting.



We have continued to invest in our business, our people, our brand and in systems and as a result have a more sales focused workforce all working towards the same common goals. We are beginning to see the results of this investment through a strengthened pipeline and remain confident in delivering full year performance in line with current market expectations."



For further information please contact:



SysGroup Plc

Adam Binks, Chief Executive Officer

Martin Audcent, Chief Financial Officer





Tel: [phone]





Shore Capital (Nomad and Broker)

Edward Mansfield/Anita Ghanekar/Daniel Bush





Tel: [phone]

Alma PR (Financial PR)

Josh Royston / Helena Bogle

Tel: [phone]





About SysGroup



SysGroup is a leading provider of Managed IT Services, Cloud Hosting, and expert IT Consultancy. The Group delivers solutions that enable clients to understand and benefit from industry leading technologies and advanced hosting capabilities. SysGroup focuses on a customer's strategic and operational requirements - enabling clients to free up resources, grow their core business and avoid the distractions and complexity of delivering IT services.



The Group has offices in Liverpool, Coventry, London and Telford.



For more information, visit hxxp://www.sysgroupplc.com








Introduction

The first half of the financial year has been one of steady progress with a focus on execution and continued delivery against our stated strategy. Revenue grew by 47.3% over the first half of last year to £5.8m, with recurring revenue of 77.8% compared to the first half of 2018. As stated at the full year, the business is continuing to invest in its sales and marketing functions to accelerate growth and expects to see the benefits begin to flow through into the second half and beyond.



This is the first six month period under my stewardship, having been appointed Chief Executive on 3 April 2018. I was delighted to welcome Martin Audcent to the Board, taking up the role of Chief Financial Officer in July and have been impressed by the contribution he has already made. Further, with the recent additions of Mark Quartermaine (November 2017) and Mike Fletcher (January 2018) as Non-Executive Directors, along with the long-standing support from our Chairman Michael Edelson, I believe that we have successfully composed a Board with the right blend of experience and skills to be able to execute the strategic vision for the Company and ultimately deliver shareholder value into the future.



At the beginning of the year we unified all Group operations and launched our services under a single brand, SysGroup, which was completed in April 2018. This has been an important step for the business following the acquisition and integration of Rockford IT (2017) and Sys-Pro (2016) and has helped to enhance our visibility and reputation in the market place. The rebranding has helped SysGroup transition towards being a more sales focused business, driven by the investments we have made to retain and recruit experienced and skilled staff in the sales and marketing functions, whilst maintaining the excellent service levels which is the bedrock of our business. Furthermore, the back-office investments made, such as a new CRM, integrated service desk platform and unified communications platforms are providing a more cohesive environment for our team. These developments will also allow us to scale the business and ensure that we can add both organic growth and integrate future acquisitions seamlessly.



At the beginning of the period, we committed to provide an enhanced working environment for all of our team in line with that of a growing technology company. We set out to refurbish our office locations throughout the course of the year with Liverpool being the first to be completed and London is expected to be completed by the end of the calendar year.



These changes typically take time to bed in, but we are already starting to see the benefits. We have added more clients and have a strong pipeline of opportunities upon which we hope to capitalise.





Strategy

SysGroup's clear focus is to expand its position as a trusted provider of Managed IT Services to clients in the UK. The Board believes that a business focused on the provision of Managed IT Services offers the highest growth opportunity and the potential for increased margins and longer-term contracts, thereby providing greater revenue visibility. In pursuit of this strategy, the Group has positioned itself as an extension of a customer's existing IT department, with an emphasis on consultative-led sales to guide customers through the complexities and developments in the market.



The Group intends to continue to supplement organic growth with carefully considered acquisitions that can add both value, through breadth of service offering and additional sector specialisms, and scale to the existing operations of the Group. We continue to actively explore strategic acquisition opportunities, being a key tenet of our growth strategy. The Company entered into advanced negotiations with regards to one sizable opportunity, however the Board was not able to get comfortable with a number of factors and the discussions were subsequently terminated by mutual agreement.



Results and trading

During the period the Group has delivered revenues of £5.8m (H1 2018: £3.93m) and Adjusted EBITDA of £0.56m (H1 2018: £0.14m). Of this revenue, 77.8% was generated from recurring Managed IT Services business, up from 72.8% at the same time last year, demonstrating the continued success of the Company's strategy.

Gross profit for the period increased to £3.57m (H1 2018: £2.38m), corresponding to a gross profit margin of 61.7% (H1 2018: 60.6%).



The expected increase in operating expenses comes from the addition of the Rockford IT business to the Group and the increased investment in Sales and Marketing and Group support functions.



Exceptional items of £0.2m (H1 2018: £0.3m) relate to the integration and restructuring of acquired businesses and also includes £0.066m for professional fees incurred relating to the terminated acquisition process.



Adjusted basic earnings per share for the Half Year ended 30 September 2018 was a profit per share of 1.1 pence (H1 FY18: 0.2 pence). Basic earnings per share (EPS) for the Half Year was a loss per share of 1.4 pence (H1 2018: 0.8 pence).



Gross cash at 30 September 2018 was £1.15m (30 September 2017: £2.69m) with net debt of £0.84m (30 September 2017: net cash £2.41m). Improvements in working capital management have led to good operating cash generation in H1 FY19 which has been invested in capex, acquisition and integration activities and has reduced the net debt from £0.92m at 31 March 2018 to £0.84m at 30 September 2018.





Market Opportunity

The opportunity for SysGroup is, we believe, both significant and growing driven by both commercial and regulatory forces, most notably in the period the implementation of GDPR in May 2018. Security, Governance and Compliance remain three of the key areas of focus for organisations looking to consume managed IT services. With increasing regulation and external threats, businesses want to minimise risk as they rely more and more on IT to deliver their own products and services. Further, they want to understand where liability and risk share lies in the case of breaches and at the same time, make their chosen solution as cost effective as possible. The volume and breadth of solutions, particularly with migration to the cloud, means that IT departments are struggling to understand what best suits their needs, exacerbated by the fact that the pace of technological change continues to be so swift.



SysGroup is ideally placed to benefit from these dynamics through its consultative approach to fulfilling clients' needs. Our staff are continually focused on the latest product developments and are able to design and present technology agnostic solutions. IT is no longer viewed merely as a burden cost centre but as a business critical enabler and with the shortage of non-industry skilled, relevant staff, an outsourced, consultative approach such as ours is proving an increasingly attractive proposition.



Sales and Marketing

The benefits are starting to be seen from the investments made in the prior year and in the first half of the current year. We now have a strong and skilled sales function with a clear go-to-market strategy under the leadership of an industry seasoned Sales Director and the resultant cultural shift within SysGroup has been noticeable.



Our continued efforts in marketing are also beginning to bear fruit. We have launched a number of external campaigns as part of our newly defined marketing strategy with the introduction of digital marketing channels, including social media and targeted email campaigns, increased our efforts on search engine optimisation and have ramped up our internal lead generation function, all of which coupled together are creating an enhanced pipeline of opportunity.



Outlook

With the support of a team of almost 100 committed colleagues, each playing to their individual strengths, the growth opportunity for SysGroup is significant and continues to accelerate.



We have a clearly defined strategic focus within Managed IT Services and Cloud Hosting, delivered through a highly consultative approach to businesses who are increasingly in need of guidance due to a continually changing landscape of risk and compliance issues coupled with a wide-ranging portfolio of solutions.



Our operations have been unified under a single brand which is gaining recognition in the market, establishing us firmly as a trusted provider and supporting our strengthened sales and marketing teams. We are seeing a strong pipeline of opportunities and our focus on the UK market should provide a level of resilience to the possible impacts on the wider market from the currently uncertain political landscape.



The continued investments we are making in the Group mean that we can effectively scale the business, both organically and through acquisition as we continue to monitor and assess opportunities.



Trading in the second half of the year has begun well and as a result, the Board remains confident in delivering full year performance in line with current market expectations.





Adam Binks

Chief Executive Officer

26 November 2018

[aishah] 22/11/2018 10:56

SysGroup took Security Vendor of the Year - SME

[aishah] 07/11/2018 12:31

BusinessCloud’s inaugural UK Business Tech Awards are set for November and will recognise the individuals and businesses who are making the most impact in the world of technology.

Every day we are highlighting a different category ahead of a glitzy ceremony at London’s Montcalm Marble Arch on November 20.

SYS is one of the finalists.


SysGroup is a leading provider of managed IT services, cloud hosting and technical consultancy, delivering innovative solutions to its clients.

With six acquisitions in three years, SysGroup has grown rapidly, but has always maintained their focus on customers’ strategic requirements, enabling them to free up resources and achieve optimal efficiency.

Headquartered in Liverpool with offices in Coventry, Telford and London, it recently announced revenue growth of 45.7 per cent to £10.45 million for the year ending 31st March 2018. This demonstrates an organic revenue growth of 21 per cent, which in itself has generated a revenue of £8.65m.

The staff headcount has increased by 168 per cent in the past two years. From a complete corporate rebrand incorporating multiple sub-brands under the SysGroup name to the announcement of their most successful financial year to date, SysGroup has established its name within the UK cloud hosting and managed services market and demonstrated its commitment to connecting as many customers as possible to powerful and innovative solutions for their unique needs.

[tiltonboy] 20/9/2018 08:22

Hope that wasn't you buying them this morning napoleon!

[weatherman] 20/9/2018 06:49

Haven't you got the wrong company ? These results are for Scisys.

[napoleon 14th] 20/9/2018 06:39

Lovely numbers out of sys
-- Adjusted operating profit up to GBP2.5m (2017: GBP1.2m restated).
-- Revenues up 13% to GBP28.7m (2017: GBP25.3m restated).
-- Half-year order book approaching GBP100m (2017: GBP64m).
-- Net debt reduced to GBP3.3m (2017: net debt GBP9.0m).
-- Interim dividend up 10% at 0.65 pence per share (2017: 0.59p).
-- Adjusted basic earnings per share 6.1p (2017: 1.4p).

i don't hold ...........yet!

[battlebus2] 31/8/2018 14:21

Yes 132% increase 👍

[aishah] 31/8/2018 13:51

Techinvest are quite positive on SYS. I see from your thread that you are already invested here, so I'm in good company. Shore Cap fcst are for 2.8p(2019) followed by 3.3p(2020). As Techinvest says, SYS are well placed to be a market consolidator for small managed service providers, so acquisitions will boost prospects here imo.

[battlebus2] 31/8/2018 12:53

Hi Aishah great to see you here, really like this one. Didn’t realise it was in Techinvest. 👍

[tiltonboy] 31/8/2018 10:04

I added yesterday following the poorly executed sale that smashed the price.

[aishah] 31/8/2018 09:48

Added first tranche yesterday having been on watchlist since Techinvest made them a new buy in July. A full write-up in August ended with "Continue to buy".

[tiltonboy] 10/7/2018 13:51

There was a seller around the low 40's that has been cleared, but mystified by this rise. Perhaps after a number of false dawns, they really have got this on the right track.

They owe me quite a lot more than these levels, but it's a start.

[battlebus2] 10/7/2018 12:41

I’ve been buying into the story at SYS, added them to the early recovery portfolio with a 60p target. Adam seems to be making progress. DYOR ofcouse.

[holts] 10/7/2018 12:31

What is that about ?