SysGroup expecting to report revenue dip of almost 16 per cent for first half of year

MSP claims impact of the pandemic continued to hurt sales

IT services and cloud hosting provider SysGroup expects its revenue to fall by 15.8 per cent for the first half of 2021 which it blames on the continued impact of the pandemic.

The AIM-listed group expects to report revenue of £7.58m for the half year ended September 30 compared with £9.01m for the same period last year.

In a trading update, the business claimed that its customers "have continued to defer and curtail expenditure decisions as a result of the pandemic" and that its sales teams "have continued to face restrictions in their ability to have in-person interactions with customers and prospects to develop the sales pipeline".

Adjusted EBITDA is expected to be £1.34m for the first half of the year, a slight dip from £1.41m last year, which it claims is "in line with management's expectations".

"Whilst the economic uncertainty of last year has continued through H1 and has affected customer decision making, I am pleased to report that our adjusted EBITDA performance is in line with our expectations," Adam Binks, chief executive of SysGroup, said.

"The long-term outlook for our business and market remains very positive and we are continuing to see an increasing number of companies seeking to move towards Cloud rather than on-premise solutions.

"We expect IT projects and investment decisions, as a business critical agenda item, to recover strongly once there is more certainty around the economic environment and the on-going impact of COVID-19."

SysGroup added that it "continues to benefit from lower overheads as a result of integration synergies delivered from past acquisitions" and that the group has "diligently managed its operations whilst continuing to invest as required in the business".

The Liverpool-based MSP saw its sales fall during its last full year which it also put down to the impact of the pandemic on its sales team and on customer spending.