Redcentric hits trading targets after recent accounting scandal

MSP releases update claiming trading for last financial year was in line with expectations, following discovery of accounting errors

Troubled managed service provider Redcentric has hit its full-year trading targets despite the recent accounting crisis that has plagued the firm, it said in an update to the London Stock Exchange.

Redcentric was plunged into chaos last year when the discovery of accounting errors revealed it had overstated net assets and profit by £20.8m.

The saga has rumbled on this year, with both the Financial Conduct Authority and the Financial Reporting Council launching investigations into the errors.

Despite the uncertainty, Redcentric today released a trading update stating that its financial results for the full year ending 31 March 2017 are "in line with the board's expectations".

While not releasing any revenue figures in the update, it claimed to have "experienced good sales momentum in the year with a number of key contract wins and renewals in both the public and private sectors".

It added it has been making "good progress" with the remedial programme launched after the account errors were uncovered, and has also strengthened its finance team and internal systems.

CEO Fraser Fisher said: "We are pleased to be able to report that trading is in line with expectations.

"Throughout the challenges at the end of last year, we have continued to enjoy the support of our stakeholders including customers, banks and loyal colleagues.

"A great deal of work has been carried out in the past few months to execute the remedial plan, strengthening our reporting and control systems."

As well has hitting financial targets, Redcentric said its net debt dropped £2.5m in the fourth quarter of the year, to £39.5m

The full-year results will be published on 29 June.