CAE delivers solid first year after its MBO

Infrastructure specialist CAE has shared its progress for 2019, its first full trading period since the business underwent a management buyout (MBO) at the end of 2018.

The MBO was led by CEO Justin Harling and chief operating officer (COO) Richard Behan with the aim of building on the momentum it had enjoyed in 2018, breaking through the £100m turnover barrier and consolidating its position as a Cisco gold partner.

The pair set up Caerus Assets Limited, a holding company that has acquired the business, and the deal was funded with the existing bank relationship and there was no need to turn to any other external sources of finance.

Plans for the business at the time of the MBO included improving domestic growth and increasing the revenues coming from overseas.

Lifting the lid on the performance in 2019, the results indicate that the management met its goals with revenues increasing by 28% from £103.9m to £132.9m. Operating profits were up by 69%, moving from £2.3m to £3.9m.

During 2019, the business established trading entities in the Netherlands and in India, adding to the UK and US operations. This helped drive growth in international sales, which improved by 184%, accounting for £13.7m of turnover.

“We know the business has huge potential and we are delighted that the figures illustrate what can be achieved in both the short and long term for CAE, especially in a year that included our MBO,” said CAE CEO Harling.

“On the back of excellent numbers, investment has continued in the business in all areas, including core competencies of networking, datacentre and security, as well as growing recurring revenues and achieving our first revenue from application development,” he added. “We are looking forward to continued growth from a focused number of vendors and strategy built on unrivalled customer intimacy.”

The firm has started this year with a restructure to align sales to vendor teams under new sales directors: Gregg Spooner, handling enterprise and public sector; Rob Finnerty, looking after commercial; and Bob Pigott, who leads the freshly formed business services department.

“If you are willing to invest and adapt to the changing needs of customers, there has never been a better time to deliver infrastructure services. CAE is ready to go with an enhanced top team that can scale the business and take it to the next level,” said Harling.

CAE has been running for more than a decade, selling into both enterprise and public sector customer bases. The business has a growing international footprint, but operates out of seven offices across the UK, with the headquarters in Watford plus operations in Oxford, London, Daresbury, Bracknell, Brighton and Glasgow.