UCaaS player Gamma Communications enjoys strong H1

Unified communications-as-a-service (UCaaS) specialist Gamma Communications has shared a solid set of numbers for its half year as it continues to tap into a post-pandemic recovery.

The firm announced a 8% rise in revenue and gross profit to £234.7m and £120.4m respectively, for H1, with its partner business continuing to improve.

Growth came on a technology front as well as being fuelled by a deeper push into Europe to target areas that yielded fresh business.

In terms of the products driving growth, SIP Trunks, driven by voice enablement of Microsoft Teams via Direct Routing, was strong, as well as Cloud PBX users, which climbed by 6% to 716,000 from 676,000. The number of Cloud PBX seats in Europe increased by 7% to 137,000.

The numbers were also the first that were fronted by Andrew Belshaw, interim CEO at Gamma, who took the reigns after former boss Andrew Taylor stepped down in July.

“I am pleased to be presenting the first set of results since I took on my new role. Gamma has had a strong first half. Our Direct business in the UK has returned to growth as we had indicated it would once the effects of Covid had worked through,” he said.

“The UK Indirect business continues to be strong, with good growth in the new variants of SIP which support MS Teams users. Our European business has increased the number of cloud seats by 7% despite a challenging economic environment.”

Looking ahead, it’s difficult not to talk about inflation, energy price rises and the squeeze on business budgets. Despite that, Belshaw said the firm should ride out the storm.

“We are seeing some effects of inflation in connectivity and hardware costs which we are generally able to pass on to customers. We expect this to continue to increase in the second half and into 2023,” he said.

“We are also seeing salary inflation, which we continue to actively manage while focusing on retention and ensuring that we support our lower-paid staff seeing unprecedented rises in the cost of living. Gamma is well-placed to navigate the publicised macro-economic headwinds.”

“We are a leader in a market with long-term structural growth, have a high degree of recurring revenue and have been and will continue to be strongly cash generative. We have a robust balance sheet that will allow us to continue to invest in the business as well as support organic growth with selected acquisitions,” he added.

Earlier this summer, TelcoSwitch urged more partners to join the dots and recognise that there is strong demand for UCaaS. Sam Giggle, head of sales at TelcoSwitch, said the channel needed to take advantage of current market conditions.

“The channel is experiencing a unique period and the opportunities for growth are immense. The demand for UCaaS solutions is clear to see, with TrustRadius research reporting that 67% of companies increased spending on communications in 2021 to ensure videoconferencing was included,” he said.