TIDMADT
RNS Number : 8939U
AdEPT Technology Group PLC
03 April 2019
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain
AdEPT Technology Group PLC
("AdEPT" or the "Company" together with its subsidiaries the
"AdEPT Group")
Trading Update
AdEPT (AIM: ADT), one of the UK's leading independent providers
of managed services for IT, unified communications, connectivity
and voice solutions, today announces a trading update for the year
ended 31 March 2019, ahead of the audited final results which are
expected to be announced in early July 2019.
The Board is pleased to report a year of continued further
progress and delivery of our organic and acquisitive growth
strategy. We have seen substantial growth across the AdEPT Group,
alongside important acquisitions which have extended our geographic
reach and our product range.
Key highlights include:
-- Anticipated increase in revenues and underlying EBITDA in
line with consensus market expectations of a 13% rise
year-on-year;
-- Net senior debt of GBP27.2m was GBP0.8m lower than market consensus expectations;
-- Board to recommend an increased final dividend of 4.90p per share (2018: final 4.50p); and
-- Anticipated total dividends proposed for the year of 9.80p
per share represents an increase of 12% over the prior period.
Cash flow and net debt
Net senior debt of GBP27.2m as at 31 March 2019 was GBP0.8m
lower than market consensus expectations which arises partly from
the cash receipt of research and development tax credits from HMRC
in the current year in respect of prior periods. AdEPT continues to
generate consistently strong free cash flow conversion from EBITDA
with a capital asset light model with capital expenditure well
below 2% of revenue.
Dividends
AdEPT announced an interim dividend of 4.90p per share in its
September 2018 interim statement, which will be paid to
shareholders on 8 April 2019.
The Board today announces that as a result of strong free cash
flow and trading results it intends to recommend a final dividend
of 4.90p (2018: 4.50p) per share which, subject to Shareholder
approval at the Annual General Meeting later in the year, will be
paid in October 2019. Total dividends proposed for the year ended
31 March 2019 of 9.80p per share represent a 12% increase
year-on-year (2018: 8.75p).
Update on Acquisitions
The AdEPT Group has grown substantially during the year ended 31
March 2019. Not only have we expanded our financial results, we
have extended our geographic reach into Yorkshire (ETS) and
developed our product range with enhanced back-up and disaster
recovery services (Shift F7).
Atomwide Limited
Atomwide, a well-established UK based specialist provider of IT
services to the education sector, was acquired in August 2017 and
positioned AdEPT as the leading IT provider to schools across
London, supporting around 2 million users of Atomwide's products
and services.
A final performance related earnout of GBP1.5 million was paid
in cash to the Atomwide vendors in October 2018, based on the first
year after acquisition.
The integration of Atomwide into the AdEPT Group has gone
extremely well and the Atomwide data centre and in-house software
development team has been instrumental in the creation of the AdEPT
Nebula(TM) proposition. We have used the Atomwide data-centre as
the basis to create our AdEPT Nebula(TM) nationwide MPLS data
network and IT private cloud hosting services. Over the last few
years we have acquired new customers using services provided from
renting space in other data-centres. These are now being migrated
to AdEPT Nebula(TM) . We are pleased to report that AdEPT
Nebula(TM) already provides services to thousands of AdEPT Group
customers.
Shift F7 Limited
Acquired in August 2018, Shift F7 is a highly accredited IT
services provider offering highly specialised IT support services
and technology solutions to more than 200 commercial mid-market
customers.
As this acquisition was made part-way through the current
financial year, it has only made an eight-month contribution to the
FY19 results. The integration of Shift F7 into the AdEPT Group has
gone well, with the Shift F7 senior management team actively
involved in cross-group IT integration initiatives.
ETS Communications Limited
ETS was acquired in November 2018 and is focused on providing
unified communications and connectivity to business customers and
has a strong public sector presence, including managing and
supporting cloud-based telephony solutions to more than 200 GP
surgeries.
Similar to Shift F7, ETS has only made a five-month contribution
to the FY19 results. The finance and support functions of ETS have
been fully integrated into the AdEPT Northampton office.
Executive Management Changes
In January 2019 we announced the elevation of Phil Race to the
position of CEO of AdEPT, with founder and previous CEO Ian
Fishwick becoming Chairman of AdEPT. The transition has gone
smoothly with their respective roles bearing fruit in terms of
developing the strategy for the coming years and the enhanced focus
on reviewing potential acquisitions. As referred to above, the
integration of ETS has been completed and the GBP0.2m synergy
savings generated from merging finance and back-office support
functions with the AdEPT Northampton office, will be used to create
the new 'One AdEPT' brand. We look forward to seeing the benefit of
these changes in the coming months.
For more information please contact:
AdEPT Technology Group Plc
Ian Fishwick, Chairman 07720 555 050
Phil Race, Chief Executive 07798 575 338
John Swaite, Finance Director 01892 550 243
Cantor Fitzgerald Europe
Nominated Adviser & Broker
Phil Davies / Will Goode 020 7894 7000
This announcement has been released by John Swaite, Finance
Director, on behalf of the Company.
About AdEPT Technology Group plc:
AdEPT Technology Group plc is one of the UK's leading
independent providers of managed services for IT, unified
communications, connectivity and voice solutions. AdEPT's tailored
services are used by thousands of customers across the UK and are
brought together through the strategic relationships with tier-1
suppliers such as Openreach, BT Wholesale, Virgin Media, Avaya,
Microsoft, Dell and Apple.
AdEPT is quoted on AIM, operated by the London Stock Exchange
(Ticker: ADT). For further information please visit:
www.adept.co.uk
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END
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