'Greens shoots clearly emerging' - MSP CloudCoCo bounces back in 2020

MSP, which merged with Adept4 in 2019, now moves into ‘get fit’ phase of growth, says CEO Mark Halpin

MSP CloudCoCo is seeing encouraging "green shoots" of recovery in the business as 2020 results show a dramatic change of fortunes for the Warrington-based firm.

Revenues were up 10 per cent to £8m in its fiscal year ending 30 September 2020, while trading group EBITDA swung from a £235,000 loss to a £261,000 profit during the same period.

Total contract value grew by 97 per cent during the year to £5.2m, which CloudCoco claims reflects early success in prioritising multi-year deals across new and existing customers.

The results mean that CloudCoCo has completed its "get well" phase and can now begin its "get fit" strategy, according to Mark Halpin, who became CEO of the business last year following the merger between Adept4 and CloudCoCo in 2019.

"Our priority since we became CloudCoCo Group plc was to re-position the business for an exciting future of sustainable, long-term growth, and in just over the 11 months together represented by these results, we have gone a long way to achieving that. There is important work still to be done but, looking ahead, we move into the "get fit" phase of the strategy - where there is a greater emphasis on business development - in a position of strength," he said in a statement.

In the trading update, CloudCoCo claimed that it's off to a strong start, claiming that, for the first four months of its fiscal 2021, trading group EBITDA is already ahead of the £261,000 it achieved in fiscal 2020.

The firm claims it has also won multi-year contract extensions with key customers Vantage Motor Group and Baywater Healthcare.

AIM-listed Adept4 acquired Leeds-based CloudCoco in 2019 for £6.1m. Months before the acquisition, Adept4 posted a £1.1m loss for the first six months of its fiscal year until 31 March 2019.

"Through careful planning, consistent hard work, determined execution, and by fostering a positive and collaborative working environment, we have made some significant progress in turning the business around in a remarkably short space of time," added non-executive chairman Simon Duckworth.

"We are still in the early stages of our long-term plan, but there are green shoots clearly emerging. With a focussed strategy in place to continue making progress, we are confident we are now on the right path to unlocking the immense potential in this business."