MTI invests in services after FY13 growth takes it past £30m

Storage and security player publishes upbeat numbers revealing big plans for cloud and services

MTI Technology grew turnover by almost a quarter and profit by more than 75 per cent during a stellar 2013 fiscal year in the UK.

Accounts recently filed with Companies House reveal that, for the year to 31 March 2013, the Surrey-based VAR grew UK turnover 23 per cent annually to a little over £32m. Operating profit soared 76.7 per cent to £1.1m, and net assets were also on the up, rising by almost £1m to stand at £3.9m at the year's end.

The accounts show that sales of products, services and consultancy all grew nicely during the year. Hardware and software sales rose 17.6 per cent year on year to £22.1m, while core maintenance services increased 23.7 per cent to £7.2m. Revenue from consulting and professional services was the biggest mover, spiking by 91.8 per cent to £2.7m.

The directors' report for the year cites the increase in the firm's services client base, alongside its new digs in Scotland, as key drivers for growth. Also helping the top line move along was the integration of security reseller GSS, which is now complete following its acquisition by MTI in 2011.

"The company has continued its programme to invest in the development of its managed services business and is making a significant investment in the growth of its cloud-based offerings," adds the report. "There is a strong belief that the company will continue to see gross profit margin growth in the fiscal year 2013/14.

"However, due to the cost of the investments being made in the managed services and cloud-based offerings, we do not anticipate similar levels of profit growth. We believe these investments are important for the longer-term growth of the business and will manifest themselves from 2014 onwards."

In August MTI revealed it was also ploughing a seven-figure sum into its security business, including expanding into a number of mainland European countries. The investment in organic expansion comes after the reseller concluded there were currently no suitable targets for further acquisitions, although another M&A play has not been ruled out for the future.