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Tuesday 14 September 2021

Profitable scale up of The Access Group continues

The Access Group logoFY21 was yet another year of growth and up scaling for UK HQ’d mid-market centric software supplier The Access Group and while the record 18 acquisitions completed during the year (see here) made a considerable contribution, the company still managed to edge into double digit organic growth.

On a pro forma basis revenue increased 53% to £480 with EBITDA up 65% to £180m. Reported revenue was £392m with EBITDA of £148m, up 48% and 61% respectively, and the company also achieved organic growth of 10% despite the COVID impact. Due to the timing of its fiscal year end in June, COVID impacted two financial years but the management team is confident that the economic effects of the pandemic are behind it. 

A brief review of Access Group’s historic performance shows that the momentum of FY21 is a continuation not a one off. For example, it has closed off 15 years of uninterrupted profitable growth and has more or less doubled in size every two years over recent years, while also improving profitability and margins much of which is down to growth in recurring revenue (see The Building of The Access Group). 

Given the volume and pace of acquisitions, we have wondered whether the company was at risk of overreaching itself. However, considering the acquisitions in the context of the move to a divisional structure where each division has its own management team and specific strategy yet is aligned with central objectives, the risk appears to be less than it seems. The pattern of acquisitions is significant. For example, the 18 acquisitions of the past year were spread across the different divisions so that no single unit had more than two significant acquisitions to consume. The model has worked to date and the strategy is becoming clearer which is reassuring, especially as the FY22 acquisition round had kicked off with Servelec up first..  

Alongside its growth Access is also ramping up its philanthropic activities having formed The Access Foundation. This charitable status entity with a £7m fund will be launched later this year to support charities that are linked to employees in a meaningful way, and community causes close to its offices in the UK, Ireland, Romania and Asia Pacific. Charitable support is not new to Access and it says it has increased its fundraising total by 775% in the last three years and continued activities during the pandemic by adapting to online events to maintain momentum and commitment to its charity partners.

Posted by: Angela Eager at 09:57

Tags: results   software  

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