Gamma Communications PLC AGM Trading Update (0271M)
May 19 2022 - 2:01AM
UK Regulatory
TIDMGAMA
RNS Number : 0271M
Gamma Communications PLC
19 May 2022
19 May 2022
Gamma Communications plc
AGM trading update
Continued strategic delivery - growth across all markets
Performance on track for 2022
Ahead of the Annual General Meeting ("AGM") to be held later
today at Investec, 30 Gresham St, London EC2V 7QN, Gamma
Communications plc ("Gamma" or the "Group") has produced the
following update on trading.
Group overview
Gamma has continued to grow throughout the first part of 2022,
while successfully executing against its longer-term growth
strategy. The Group has seen growth in its three operating segments
and we expect this positive momentum to continue through the rest
of the year.
A selection of highlights in the first part of the year
includes:
-- Growth in gross profit in the Indirect Business for 2022 will
be consistent with the previous year (c8% growth year on year).
-- New project wins for the UK Direct business will drive growth
in the second half of the year; revenue growth will approach 10%
(2022 against 2021). We have experienced minimal impact from the
well-publicised chip shortage.
-- Strong momentum in Cloud PBX across our European business,
with Germany in particular performing well.
-- ARPU has been maintained through the successful up-sell of
additional modules to Unified Communications as a Service ("UCaaS")
customers.
-- We continue to monitor inflationary pressures - and do not
expect any material impact to our financial performance in
2022.
Balance Sheet
Our balance sheet remains strong and underlying trading
continues to generate cash. Gamma had net cash of GBP54.0m at 30
April 2022; this is after paying GBP1.7m of contingent
consideration on acquisitions and making early supplier payments of
GBP6.7m to receive prompt payer discounts.
Dividend
The proposed final dividend in respect of the year ended 31
December 2021 will be put to the normal shareholder vote at the AGM
later this morning. The proposed final dividend is 8.8 pence (2020:
7.8 pence) being GBP8.5 million in cash terms. When added to the
4.4 pence interim dividend (2020: 3.9 pence) this will equate to a
total dividend declared of 13.2 pence for the full year (2020:
total 11.7 pence).
Outlook
The Board remains very positive about the prospects for Gamma.
The Group continues to deliver against its long term growth
strategy. Gamma has a compelling, technology-led product portfolio,
effective routes to multiple customer bases and a number of market
leadership positions. The business is in a strong financial
position, which enables it to continue to invest in products and
market development.
Based on our trading in the first part of the year, we expect
adjusted EBITDA and adjusted EPS for the year ending 31 December
2022 to be in the upper half of the range of market forecasts*.
The Board will provide its next trading update prior to the
publication of the half year results on Tuesday 6 September.
* Note: Company compiled range is based on sell side analyst
estimates which have been updated to take into account Gamma's 2021
audited results. The ranges are Adjusted EBITDA GBP101.0m -
GBP106.8m and Adjusted EPS 66.6 pence - 74.6 pence.
Gamma Communications plc Tel: +44 (0) 333 006 5972
Andrew Taylor, Chief Executive
Officer
Andrew Belshaw, Deputy Chief Executive
Officer
Bill Castell, Chief Financial Officer
Tulchan Communications LLP Tel: +44 (0) 207 353 4200
James Macey White / Matt Low
Investec Bank plc (NOMAD & Broker) Tel: +44 (0) 207 597 5970
Patrick Robb / Virginia Bull
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END
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