Redcentric shares preliminary FY numbers as CEO bows out

Redcentric has indicated a sharp eye on costs and increased cross-selling has helped to improve its financial fortunes.

The managed service provider (MSP) has shared preliminary numbers for its fiscal year ended 31 March, with revenues improving and losses reducing.

The MSP reported total revenue growth of £163.2m, which represented a 15.2% to increase on last year’s £141.7m. The portion that is recruiting was also up by 16.1% to £149.1m, representing 91.4% of the total turnover. Operating profit increased by £9.8m to £0.9m and pre-tax losses tumbled by £7.8m to come in at £4.7m.

The firm also indicated that it had integrated acquisitions and the Harrogate datacentre exit had been completed as planned.

The update gave an opportunity to indicate that Q1 trading was in line with expectations. With the business heading in the right direction, Peter Brotherton announced his retirement and plans to step down from the CEO position at Redcentric once a suitable successor is found.

Brotherton comments accompanied the results for what may be one of his last occasions to talk about the business, with a focus on the positives.

“FY24 was a very productive year, with all the original integration programmes completed, generating cost savings either in line or slightly ahead of our expectations,” he said.

He spoke about some of the specific moves the business had made to control costs and how there was room for further benefits to come this fiscal year.

“The electricity conservation measures are now yielding very significant volume savings, which combined with secured lower electricity prices from 1 April 2024, are expected to reduce electricity costs by £8.1m in FY25,” he added.

Looking ahead, his immediate to-do list – and the task for his successor – is to keep driving the business forward to improve the balance sheet even further.

“The focus for FY25 will be to drive organic revenue, profit and cash flow growth by cross-selling the broadened product and solution portfolio into the enlarged customer base, while also capitalising on the structural opportunities presented by AI-related demand and the recently awarded VMware Pinnacle partnership agreement,” he said.

Brotherton used his segment in the FY numbers update to look back over his time leading the firm, commenting on the evolution that had taken place in the past few years.

“The business is now in a very different place to when I joined in November 2016. All of the historical issues have been overcome and the acquisitions undertaken in FY22 and FY23 have significantly increased the scale and capability of the business,” he said.

“Revenues and profits for FY25 are on course to be double what they were pre the acquisitions and solid foundations are now in place for sustainable and profitable growth. I would like to thank my colleagues on the operating board and all Redcentric’s employees for their dedication, help and support during my tenure,” he added.