Thursday 17 December 2020

*UKHotViewsExtra* Timico straps on the profit rocket boosters

timicoFollowing on from the news that Timico is to buy Arcus Cloud Services, we caught up with Neil Muller (CEO) and Paul Farrelly (Chief Digital Officer).

The firm is just posting accounts for FY19, showing revenue up 25% to £55m and Adjusted EBITDA up by a whopping 162% to £7.6m. Of course, we’re now largely through FY20, and forecasts are indicating a 9% increase in the top line to c£60m. Profits will leap again this year - by c30% - to just shy of £10m. In other words, EBITDA has trebled on Muller’s watch. 2020 organic revenue growth will be modest as the firm has continued to actively manage SMB (Small and Medium sized Businesses) revenue declines. 

Central to the approach Muller is undertaking is a considered and active M&A strategy. His leadership team is structured in such a way that allows them to take care of day-to-day operations while he and his acquisition specialists funnel their energy into scanning the market for potential ‘gems’. He’s rebuilt the entire team (retaining only John Holt - as COO), with notable hires including Daryl Paton (Chief Financial Officer), Scotty Morgan (Chief Sales Officer), Paul Farrelly (Chief Digital Officer), David Jones (Chief People Officer), and Victoria Marcer (Chief Corporate Development Officer).

The recent Arcus transaction was a really neat add-on, bringing both Amazon Web Services and Public Sector expertise (sectors outside of Central Government and Defence) in one hit. We estimate that as much as 15% of Timico’s revenue is now derived from AWS-related services. Terms of the purchase were not disclosed, and we’d be surprised if we have to wait too long for more add-on news.

Muller has led Timico through substantial change over the two years since he joined. In 2018, the majority of business sold by the firm was telco and SMB based. Together, those two now account for less than 10% of revenue. Indeed, we wouldn’t be surprised if that number reduces further in time. MORE…..

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Posted by Kate Hanaghan at '09:48' - Tagged: cloud   connectivity   cyber   hybrid   SD-WAN