Calyx growing again as it waves off chairwoman Timothy

Chief executive says hardware move and debt-for-equity swap have improved VAR's fortunes in recent months

Calyx Managed Services chief executive Steve Clark claims the VAR is on course to grow again in 2014 as it parts ways with chairwoman Fiona Timothy.

Timothy has resigned from the board of directors at Calyx and sister company m-hance as she steps away from her role as chief executive of private-equity backer Better Capital.

Talking to CRN, Calyx chief executive Steve Clark (pictured) confirmed that Timothy had opted to retire after deciding she no longer wanted to work a five-day week.

Both Calyx Managed Services and m-hance endured a tough 2013, with the former seeing sales tumble 18 per cent to £23.9m. Better Capital recently wrote down the carrying value of both firms by £13.8m to reflect their weaker performance.

But Clark said Calyx's performance has been buoyed by a recapitalisation in December designed to improve its access to public tenders, as well as its move to reinvigorate its hardware business.

"We did a debt-for-equity swap to get rid of the loan notes, which were seen as debt, which was making our balance sheet look horrendous," Clark said.

"It inhibited our ability to trade and our balance sheet is now far healthier than it was."

Better Capital's plan on buying Calyx from administration in 2010 was to shift it from its heritage as a reseller and deeper into managed services.

Clark said the decision to modify this strategy 15 months ago by reigniting its business with hardware vendors such as Brocade, Juniper, HP and NetApp - if only as a means to ultimately secure a services relationship with its customers - is paying off.

"We have been very successful in bringing the product piece back to bear," Clark said, adding that sales are on course to reach £25m this year.

"Previously, we were moving away from that. We reinvigorated that and have had some good infrastructure wins in the last six to seven months, which have got us into organisations where we have started to sell more services."

Clark's comments are echoed by Better Capital, which said in February that the VAR - which focuses on firms at the upper end of the SME market with 500 to 2,000 users - is showing "early encouraging signs" following a refocusing of the sales team in 2013.

"At the time of writing, the pipeline has improved for the third month running with good prospects of delivering a solid first quarter for the year ending December 2014," Better said in an interim management statement in February.

Clark said Calyx Managed Services was ahead of budget for Q1 and is set to repeat this in Q2.

According to Companies House, Timothy resigned her directorship of both Calyx Managed Services and m-hance on 4 April. She has been replaced by Better Capital's Nick Sanders.