Alternative Networks pumps £1m into cross-selling drive

Revenues and profits rise as customers get stickier

Alternative Networks claims it invested £1m in account management resources to drive cross-selling in its business during its last fiscal year.

The AIM-listed VAR and MSP said it enjoyed a "robust year", with revenue and profit rising as it achieved greater stickiness with customers.

For the year ending 30 September, revenue reached £146.8m, nine per cent up on the previous year or four per cent up controlling for the boost it enjoyed from its acquisitions of ControlCircle and Intercept in January 2014.

Flattered by a £2.4m profit arising from a property sale, pre-tax profit leapt 33 per cent to £13.8m. Adjusted EBITDA rose 13 per cent to £22.1m.

Mark Quartermaine, CEO at the Mitel, BT, Juniper and Citrix partner, said: "The two acquisitions in 2014 and the transformational projects in 2015 have resulted in Alternative Networks becoming an IT services business with a unified operational structure, a fully invested sales force and a market-leading product portfolio, able to deliver end-to-end solutions to a larger customer base."

The Advanced Solutions unit, which houses the former ControlCircle and Intercept businesses, saw revenue rise 10 per cent to £77.9m, with recurring revenues contributing £45m of that total. Mobile voice generated £40.4m in sales and fixed voice £28.5m.

During the year, Alternative Networks invested £1m in boosting account management resource to drive product penetration across existing customers.

Some 46 per cent of customers took more than one product from the firm during fiscal 2015, with 17 per cent taking four or more.

Former CEO Ed Spurrier indicated to CRN that the firm would take an acquisition break following last January's double swoop, which it funded partly by borrowing £43m. But with net debt having now been trimmed to £18.7m, further "right-fit" acquisitions are on the cards, Quartermaine indicated.

"Acquisitions are being targeted to complement the existing products and to further expand our capabilities and product set in the advanced solutions area, with a focus on managed and hosted services," Quartermaine (pictured) said.