iomart inflated by cloud acquisitions

Cloud computing provider iomart lifted its dividend by more than half as three acquisitions boosted sales and profits.

The highly cash generative company increased revenues 29% to £43.1m, with earnings before interest, tax, depreciation, amortisation and one-off acquisition costs soaring 48% to £16.5m.

The Glasgow-headquartered group proposed a 56% increase in its final and total dividend to 1.4p per share after cashflow from operations swelled by 54% to £14.8m.

But due to acquisition spending the company moved from a net cash position of £2.5m to a small net debt position of £0.4m by the year-end.

During the year iomart acquired and completed the integration of three internet hosting businesses, Melbourne Server Hosting for £6.7m in August, Skymarket for up to £1.4m in July and Internet Engineering for £1.4m in October.

Together the three businesses added £894,000 of pre-tax profits from a combined £3.7m revenue.

Chief Executive Officer Angus MacSween said: "Trading since the year end remains encouraging and in line with our expectations.

"We continue to be well placed to deliver an ever wider range of cloud services and with our growing credibility and strength we expect to be able to penetrate further into the corporate environment.

"Our experience and skills are growing and we continue to improve and invest in our systems and people to support further significant growth. I look forward once again with confidence to the year ahead."

Shares in iomart were down 2.0% at 243.75p at 9.20 on Wednesday.

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