Software Circle: Software Circle annual profit up 71% on deals and margin gains

(Alliance News) - Software Circle PLC on Thursday said annual profitability surged, driven by acquisitions and margin expansion, despite mixed organic revenue performance across its portfolio. The UK and Ireland-focused vertical market software investor said operating earnings before interest, tax, depreciation, and amortisation for the financial year ended March 31 jumped 71% to GBP4.8 million from GBP2.8 million a year earlier, as the group's operating Ebitda margin improved to 26% from 17%. However, shares in Software Circle were down 4.0% at 28.60 pence in London on Thursday afternoon. Adjusted Ebitda, which accounts for central administration costs, rose 88% to GBP3.2 million from GBP1.7 million, with the margin up to 17% from 10%, hitting the firm's target of exceeding 15%. Revenue rose 13% to GBP18.3 million from GBP16.2 million. Organic revenue grew 5% excluding print software unit Nettl Systems, but fell 7% including it due to weaker non-recurring income. The company made three acquisitions during the year - Bethebrand, LinkMaker and Total Drive - bringing the group total to nine businesses. It ended the year with annualised revenue of just over GBP20 million and a run-rate adjusted Ebitda margin of around 20%. Software Circle said its main financial priority remains maximising operating cash flow per share, which declined to 0.5 pence from 0.6p, reflecting a capital raise in September 2023. The group had GBP8.2 million in cash and a GBP10 million available debt facility at year-end. It said it intends to release full-year results in July. "We believe [operating cash flow per share] is the clearest long-term indicator of shareholder value creation," the company said. By Eva Castanedo, Alliance News reporter Comments and questions to newsroom@alliancenews.com Copyright 2025 Alliance News Ltd. All Rights Reserved.