Second-hand kit demand fuels tinglobal's IPO plans

Refurbished kit specialist says recession has not derailed its plans to float on AIM

Haddrell: we need to get to £40m revenues to be interesting to the market

Refurbished dealer tinglobal has unveiled plans to grow into a £40m-turnover behemoth and float on the stock exchange amid rising demand for second-hand kit.

The refurbished IBM, HP, Sun and Cisco dealer posted a 35 per cent rise in turnover to £23.4m for its financial year to 31 May. Even with the contribution of recent acquisition Powercore stripped out, revenue swelled by about 13 per cent.

Managing director Rod Haddrell said: “Since the recession started we have posted month after month of record performances. People are realising that if they want to stretch their budgets they need to look at refurbished more than ever.”

Tinglobal intended to float on the alternative investment market once it breached the £20m-turnover barrier, but Haddrell admitted it must now do more to catch the eye of investors.

“Our IPO prospects are on hold while the market recovers but we are still pursuing a growth strategy to position us for that in due course. We need to get to £40m revenues and £2m in EBITDA to be interesting [to the market].”

Haddrell admitted that the integration of HP and Sun specialist Powercore had been more painful than anticipated but indicated that tinglobal is already ready to acquire again.

Adding to tinglobal’s nascent maintenance arm would be a priority, he signalled, as tinglobal’s 800 reseller customers are demanding more engineering expertise. The firm has up to £2m to spend.

“Clearly there is a big skills gap in engineering,” he said. “A lot of manufacturers have priced themselves out.”

Nick King, chairman of IBM reseller Apex, said: “Remarketed kit may not be the most prudent investment route but when there is pressure on capital expenditure people look for the most cost-effective path."