KCOM to get laser focused on cloud, collaboration and fibre

Hull-based comms provider says it wants to focus on fewer, specific areas as it unveils annual results

KCOM Group has earmarked cloud services as one of three key "strategic growth areas" it will invest heavily in as it unveiled 2015 results that were in line with expectations.

The London-listed firm, which is in the process of aligning its various brands around the enterprise, SME and consumer markets, had a steady year as its top line fell but its bottom line expanded.

Results from continuing operations, before exceptional items, showed revenues for the year to 31 March falling 6.1 per cent to £348m and pre-tax profit clambering 3.2 per cent to £51.5m.

Over the coming 12 months, KCOM Group said it will align all its resources to serve the enterprise, SMB and consumer segments, where it operates through the Kcom/Smart421, Eclipse and KC brands respectively.

"To do this, we will begin the process of further integrating our existing brands to align with those market segments," it said.

"Investment will be prioritised tightly on our strategic growth areas where we see increasing opportunity, in particular the provision of cloud-based services, the integration of collaborative systems and related consultancy and integration activity, and the development of fibre-based propositions."

KCOM Group operates two brands – Kcom and Smart421 – in the enterprise space but it is not yet clear if and when they will be unified as the alignment process progresses.

In a statement Joseph Spear, Smart421's head of marketing, told CRN: "Progress towards alignment of enterprise, SMB and consumer at KCOM Group is very positive. The move means that enterprise customers of the Kcom brand and the Smart421 brand will see improved access to the services and capabilities offered by both brands this year."

By brand, Hull-based consumer broadband provider arm KC generated the lion's share of the profit, pulling in EBITDA of £56.4m on revenues of £104.8m.

SMB arm Eclipse posted an EBITDA of £15.5m on revenues of £29.6m.

On the enterprise side, Kcom posted an EBITDA of £15.5m on sales that fell from £214.3m to £188.8m, year on year, while Smart421 generated an EBITDA of £3.1m on flat sales of £30.2m.

KCOM Group sees Kcom's recent virtual call centre deal with HMRC – its delivery of which was recently praised by HMRC bigwig Mark Dearnley – as exactly the kind of project it wants to focus on in the enterprise space.

"In the enterprise market, we are increasingly recognised as a partner of choice for the delivery of complex integration projects, as is evidenced by the successful implementation of a private cloud, contact solution for HMRC," the firm said.

"This success reflects our strategic decision to invest in our IP-based 'Workplaces' services platform, migrating the business away from the provision of declining voice and volume-based connectivity services."