13. XMA

GII: £332.7m

Established more than four decades ago, XMA has long positioned itself as a trusted IT advisor across the public, education and corporate sectors. But like many in the channel, the 2023 financial year brought its fair share of headwinds. Revenues declined 6 per cent compared with 2022, a reflection of market-wide caution and rising input costs. Inflation put additional strain on the bottom line, prompting a renewed focus on spend control across employment, travel and marketing.

Despite the downturn, XMA has used the year to consolidate and refocus. A significant move came with the transfer of assets from fellow Westcoast Group company Capito Ltd into XMA Ltd — a strategic integration that effectively folded the Scottish IT services business into the core operation. From 2023 onwards, all Capito-linked activity has been booked through XMA, streamlining the group’s go-to-market and financial reporting.

Looking ahead, the directors struck a cautiously optimistic tone. While the first half of 2024 came in slower than hoped, performance has tracked broadly in line with last year. The business sees signs of pent-up demand in the market, particularly around infrastructure. With much of the networking and workplace tech deployed during the early pandemic years now approaching obsolescence, customers are expected to revisit their strategies and modernise.

Another growth vector is emerging from the workforce challenges faced by XMA’s client base. With staff costs rising and skilled talent in short supply, organisations are increasingly leaning on automation and digital tools to bridge the gap — a trend XMA believes it is well placed to support.

Financially, the business remains on a solid footing. Shareholders’ funds rose to £23.9m in 2023 (up from £22.0m), and the company continues to benefit from a £multi-million invoice discounting facility led by Lloyds Bank Commercial Finance. While this credit line is only called upon in downside scenarios, it gives XMA room to manoeuvre and respond quickly to working capital demands.

Backed by strong internal controls and a well-established position in the UK public sector and education markets, XMA enters 2024 with confidence.