Azzurri rediscovers mojo

Comms integrator claims it is delivering to three-year plan approved by new banking backers

Azzurri's boss has claimed a sense of "stability and momentum" has returned to the comms integrator after it has hit its financial targets for four consecutive quarters.

As it unveiled its full-year 2012 numbers, the Avaya, Cisco and Mitel partner also revealed it is launching a communication-as-a-service offering that will enable it to target cash-strapped customers reluctant to sign off large cheques on infrastructure upgrades.

Azzurri was significantly behind budget when current chief executive Vim Vithaldas (pictured) seized the reins 13 months ago following a refinancing that saw a syndicate of seven banks take ownership of the Newbury-based firm.

Although both turnover and profit dropped in the company's full-year 2012, Vithaldas stressed that it was a "year of two halves", with 65 per cent of profits generated between January and June.

For the 12 months to 30 June 2012, Azzurri's operating profit slipped 24 per cent to £9m on revenue that fell three per cent to £126m.

Four of Azzurri's five "centres of excellence" – data, ICT, mobility and support – saw growth in the second half of the year and Vithaldas said this momentum has carried into the first two quarters of its current year. Revenue is set to rise slightly and profits by significantly more for full-year 2013, he added.

"For the first time in four or five years, Azzurri has hit the financial metrics we were set for four consecutive quarters," Vithaldas said.

"We signed up to a three-year plan and that plan is being delivered to target. There is a real sense of stability and momentum we are beginning to gain in the business."

In the second half of fiscal 2012, only Azzurri's fixed-line business shrank, with mobility and support growing single digits, data by nine per cent and ICT by 17 per cent.

"That was a surprise, as ICT is effectively people investing in telephone systems or call centres, and that requires a large capex cheque," said Vithaldas. "With the macroeconomic conditions, I did not expect that to grow."

Despite this, Vithaldas said Azzurri is developing a communication-as-a-service offering to target cash-poor customers unable to splash out on capex infrastructure upgrades.

"We do not want to see that replacing our capital expenditure business – as we are always delighted to receive a £1m cheque – but this addresses a market where customers want to do something but do not have the money," he said, adding that it will also increase Azzurri's recurring revenue, which currently stands at 75 per cent of sales.

Vithaldas conceded that very few of Azzurri's 600 core customers buy all five of its services but the priority for 2013 is to sell more to existing clients, rather than forge ties with new ones.

"It is always easier to sell more to an existing customer than win a brand new logo," he said. "Customers want one supplier if something goes wrong and the more we can do with that same customer, the more price competitive we can be."