Gamma announces interim results for six months to June 2016


Gamma Communications plc, a leading, technology based provider of communications services to the UK business market, is pleased to announce its unaudited interim results for the six months ended 30 June 2016.

Financial highlights

Six months ended 30 June 2016 Six months ended 30 June 2015 Change (%)
Revenue £104.7m £92.4m +13.3%
Gross Profit £47.7m £39.2m +21.7%
Gross Profit margin 45.6% 42.4%
EBITDA £14.8m £11.2m +33.0%
Adjusted EBITDA* £16.3m £13.0m +25.4%
Profit Before Tax £10.6m £7.6m +39.5%
Adjusted Profit Before Tax* £12.0m £9.4m +27.7%
EPS (diluted) 9.1p 6.7p +35.8%
Adjusted EPS* (diluted) 10.1p 8.2p +23.2%
Interim Dividend per share 2.5p 2.2 +13.6
Net operating cash inflow before tax** £13.8m £10.9m +28.2%
Net operating cash inflow before tax** / Adjusted EBITDA* 84.7% 83.8%

* “Adjusted” is defined as being before share based payments of £1.4m (2015:£1.8m) and exceptional items of nil (2015:nil) (see note 4) (and associated tax effects in the case of adjusted EPS)
** Net operating cash inflow before tax is defined as “Net Cash flows from operating activities” plus “Taxes paid” before exceptional cashflows

Operational highlights

  • Installed SIP Trunks increased from 360,000 at 31 December 2015 to 413,000 (+14.7%)
  • Cloud PBX users increased from 142,000 to 188,000 (+32.4%)
  • Gross profit from indirect business increased from £30.3m in the first half of 2015 to £37.6m (24.1%)
  • The number of active Channel Partners grew from 834 at 31 December 2015 to 906 (+8.6%)
  • Strong growth in direct business, gross profit up from £8.9m to £10.1m (13.5%)
  • Key new contracts include Strutt & Parker, Menzies LLP, Berendsen plc, Morrisons Utility Services and a large financial institution.
  • Good progress in the public sector, new contracts include Symphony Housing Group, AQA, Betsi Cawaladr Health Board, East and North Herts NHS Trust.
  • Full Mobile (MVNO) service developed on time
  • Product pipeline remains strong and service quality remains high

Bob Falconer, Chief Executive Officer, commented: “We are very pleased with the progress we have made across several fronts in the first half of 2016. Our strategic products have continued to add volume and we are seeing an acceleration in the take-up of our data services. Getting our new full MVNO mobile capability ready for service by June as planned has been a major achievement and positions the business extremely well for the future.”