Bytes Technology Group reports solid full-year growth

Software, security and cloud service specialist Bytes Technology Group reported strong growth in its preliminary results on Tuesday, with gross invoiced income up 10.1% at £1.44bn.

The FTSE 250 company said revenue for the 12 months ended 28 February was ahead 26.5% at £184.4m, while gross profit jumped 20.7% to £129.6m.

Its gross margin, however, slightly decreased to 70.3% compared to the previous year's 73.7%.

Operating profit rose 20.6% to £50.9m, while adjusted operating profit increased 21.8% to £56.4m.

Bytes' cash reserves grew 8.8% to £73m, further strengthening the company’s financial stability.

The cash conversion rate for the financial year was 84.3%, down from 2022’s 131.9%.

Earnings per share rose 23% to reach 16.88p, while adjusted earnings per share were ahead 23.1% at 18.83p.

Bytes Technology Group's board hiked the final dividend per share by 21.4% to 5.1p, and its special dividend per share by 21% to 7.5p.

Looking ahead, the company’s board expressed confidence in its current trading and future outlook.

It said Bytes’ positive performance in the 2023 period had continued into the new year, indicating sustained momentum.

While acknowledging macroeconomic headwinds, Bytes said it was optimistic about its ability to navigate challenges and capitalise on opportunities.

“I am delighted to be reporting another positive set of results, with strong double-digit growth driven by contributions from all areas of the business,” said chief executive officer Neil Murphy.

“This performance was underpinned by continued growth from both our public sector and corporate clients, with customers showing a sustained appetite to invest in their IT requirements.

“We have seen our gross profit increase by 20.7% as we have expanded our customer base and increased our share of wallet among existing customers.”

Murphy said that at the same time, Bytes believed that its customer-oriented proposition had enabled it to take market share from competitors.

“A key part of our success can be traced to the high-quality customer service that sits at the centre of our business and makes us so competitive in our markets.

“Looking ahead, we have made a positive start to the current year, and we believe our strategy leaves us well positioned to benefit from the growth opportunities we see in our chosen markets.”

At 1110 BST, shares in Bytes Technology Group were up 0.31% at 450p.

Reporting by Josh White for Sharecast.com.