IMImobile swings to loss as acquisition costs offset underlying growth

Cloud solutions provider IMImobile swung to a loss in the first half of its trading year despite seeing revenues and underlying profits advance.

Revenues climbed 26% across the six months ended 30 September to £67.2m, while gross profits also picked up 18% to £29.2m - driven by strong organic growth in monthly recurring revenues. Adjusted EBITDA soared 35% to £7.7m and diluted adjusted earnings per share shot up 37% to 6.6p.

However, IMImobile turned in a small loss after tax of £100,000 - a marked turnaround from the £1m profit recorded a year earlier - as a result of its acquisitions of North American outfits Impact Mobile in the first half and Express Pigeon at the start of the second.

Cash and equivalents fell 23.5% to £12m and the AIM-listed outfit also swung to a £9.3m net debt position from the net cash of £4.3m it had on hand just six months earlier.

Chief executive Jay Patel, said: "The group has continued to perform well, both on a financial and operational basis. We have a strong position as market leader in the UK, Canadian and South African markets and have seen numerous, multi-year new contract wins in the UK across our core sectors."

Multi-year new contracts were won with large enterprise clients in the banking, utilities, retail and logistics sectors.

Patel said a "strong start" had been made to the second half and he remained confident about prospects for the full year. "We expect full year results to be in line with management expectations."

As of 0910 GMT, IMImobile shares had picked up 1.64% to 297.80p.