Software Circle (SFT) H1 24/25 earnings summary

Executive summary

• Added two acquisitions, Bethebrand and Link Maker, expanding to eight vertical market software businesses across sectors including Graphics & Ecommerce, Professional Services, Property, Education, and Health & Social Care.

• Focused on disciplined capital deployment, organic growth, and improving EPS to build long-term shareholder value.

• Board changes included welcoming new NEDs and acknowledging outgoing members for their contributions.

Financial highlights

• Revenue rose 8% year-over-year to £8.9m for the six months ended 30 September 2024.

• Operating EBITDA increased 54% to £2.3m; aEBITDA up 50% to £1.5m.

• Gross profit grew to £6.3m with gross margin improving to 71% from 61% year-over-year.

• Net cash position at £2.4m, cash and equivalents at £12.7m, and EPS at 0.3p versus (1.3)p last year.

• Operating cash flow from operations was £1.5m, with per share cash flow at 0.2p.

Outlook and guidance

• Annualised revenue run-rate expected at £20m, a 20% increase over last year.

• Adjusted EBITDA margin above 15% of revenue targeted; management remains cautiously optimistic for the year.

• Recurring revenues now 67% of total, expected to rise further with future acquisitions.