Profit drops as Iomart revenue set to rise to £143m – Daily Business

Iomart, the Glasgow-based cloud computing firm, is set to report an increased revenue of £143 million on the back of successful acquisitions.

The company’s pre-close trading statement for the year ended 31 March 2025 shows a revenue rise of 13% compared to the previous 12 months.

Adjusted profit before tax is expected to drop from £15m to approximately £6.5m.

The growth includes contributions from acquisitions, including approximately £21m from Microsoft solutions provider Atech Support and an estimated £4m from the full-year impact of small acquisitions completed in the previous financial year.

Excluding acquisitions, the core business experienced a revenue decline of 7 per cent to approximately £9m, year-on-year, the decline driven by elevated churn levels among the group’s self-managed customer base and certain private cloud managed services.

The company said overall profitability had been affected by cumulative customer losses in its more traditional service lines, such as dedicated servers and data centre services.

The group’s operating cash generation improved from the first half of the year and net debt at 31 March 2025 is expected to be approximately £102m (31 March 2024: £42.3m), reflecting M&A-related cash payments of approximately £57m.

Adjusted EBITDA is expected to be approximately £34.3m, down from £37.7m, including a six-month EBITDA contribution from Atech of approximately £3m.

The announcement of its full year results is expected in the latter part of June 2025.

Lucy Dimes, CEO of iomart Group plc, said: “Our acquisition of Atech has been game-changing, delivering a strong performance in its first six months, validating the valuation paid and enabling us to reposition the group as a scale hybrid cloud services provider with market leading managed security services and SOC capabilities.

“We see the upcoming financial year as an important transitional phase, during which we will continue to invest in aligning the business towards these higher-growth, scalable areas of the market, to realise our ambition of becoming the UK’s leading secure cloud services provider. As we continue this transformation, and in line with market trends, we anticipate overall revenue to further shift away from mature, higher margin, capital-intensive dedicated servers and data centre services, resulting in some further margin dilution at a similar level of the last 12 months.

“We are actively pursuing initiatives to optimise costs and margins, including reviewing our data centre estate, increasing operational efficiencies such as expanding capacity through our team in India, and investing in systems standardisation and automation, including AI, to lay the foundations for future efficient scalability.”