Bytes Technology Group plc (LON:BYIT, JSE: BYI), one of the UK and Ireland’s leading software, security, AI and cloud services specialists, has announced its financial results for the year ended 28 February 2025 (2024/25).
Financial performance
| Year ended 28 February 2025 | Year ended 29 February 2024 | % change year on year | |
| Gross invoiced income (GII)1 | £2,099.8m | £1,823.0m | 15.2 |
| Revenue2 | £217.1m | £207.0m | 4.9 |
| Gross profit (GP) | £163.3m | £145.8m | 12.0 |
| Operating profit Operating profit/GP% | £66.4m 40.7% | £56.7m 38.9% | 17.1 |
| Cash | £113.1m | £88.8m | 27.4 |
| Cash conversion3 | 113.8% | 116.4% | |
| Earnings per share (pence) | 22.78 | 19.55 | 16.5 |
| Final dividend per share (pence) Special dividend per share (pence) | 6.9 10.0 | 6.0 8.7 | 15.0 14.9 |
Financial highlights
– GII exceeded £2bn for the first time, increasing by 15.2%, primarily driven by software.
– GP growth of 12.0%, with 8.9% corporate growth and 18.2% public sector growth, and double-digit growth in software and services.
– Operating profit increased by 17.1%, with the operating profit / GP margin increasing to 40.7%.
– Final ordinary dividend of 6.9p, resulting in a full-year dividend of 10.0p, up 15.0%, together with a special dividend of 10.0p.
– Strong balance sheet with closing cash of £113m and 114% cash conversion.
1 GII is a non-International Financial Reporting Standards (IFRS) alternative performance measure that reflects gross income billed to customers adjusted for deferred and accrued revenue items. GII has a direct influence on our movements in working capital.
2 Revenue is reported in accordance with IFRS 15 Revenue from Contracts with Customers. Under this standard, the Group is required to exercise judgement to determine whether the Group is acting as principal or agent in performing its contractual obligations. Revenue in respect of contracts for which the Group is determined to be acting as an agent is recognised on a ‘net’ basis (the GP achieved on the contract and not the gross income billed to the customer). Our key financial metrics of GII, GP, adjusted operating profit and cash conversion are unaffected by this judgement.
3 Cash conversion is a non-IFRS alternative performance measure that divides cash generated from operations less capital expenditure (together, free cash flow) by operating profit. In prior years, the measure divided ‘free cash flow’ by adjusted operating profit. Accordingly the previously reported cash conversion for the year ended 29 February 2024 of 104.3% has been revised to 116.4% above.
Operational highlights
– Existing customers contributed 97% of our GP in this year (2023/24: 97%), at a renewal rate of 109% (2023/24: 109%).
– Headcount growth of 17.8% to 1,245 (29 February 2024: 1,057), with focus on bolstering sales and service delivery teams while ensuring support areas also grow to support the expanding business.
– Continued to grow our physical footprint by opening offices in Sunderland and Portsmouth, expanding floorspace in London and, towards the end of the year, the acquisition of two buildings adjacent to our Leatherhead office to cater for our further expansion
– Renewed our Microsoft Azure Expert status for provision of managed services and secured more security and cloud specialism.
– Received multiple vendor awards, including from Palo Alto Networks, Axonius, Check Point, Sophos, Cato Networks, Bitdefender, Adobe and Druva.
– Both Bytes Software Services and Phoenix Software named among the UK’s top 50 Best Workplaces 2024.
Sam Mudd, Bytes Technology Group Chief Executive Officer, said:
“I am proud to report another strong set of results for BTG, marked by a significant rise in operating profit. This performance reflects robust and sustained demand for our comprehensive suite of software, solutions, and services. Despite a challenging macroeconomic environment, we have not only deepened our relationships with existing clients-securing a greater share of their IT spend-but also successfully expanded our footprint across both public and corporate sectors.
The Group continues to make investments in personnel, systems, services and new vendor accreditations to drive growth and support our customers to navigate the complexities of the evolving IT market where innovation, cloud and security are only becoming more important. The strength of our relationships with Microsoft and many other top-tier vendors, such as Adobe, AWS, Check Point, Dell, VMware and Service Now, allows us to seize exciting opportunities in cloud adoption, data and workload migrations, storage, security and virtualisation technologies. We continue to expand our collaboration with customers as they roll out emerging AI technologies like Copilot, working closely with their teams to embed these tools into their businesses to support growth and drive efficiency.
The sustained demand in structural growth areas such as cloud, security and AI, our commitment to customer service, our expanding technical capabilities and our high levels of accreditation underpin our confidence for continued strong growth in our financial year 2025/26.
I have been hugely impressed by the commitment and professionalism of all of our staff as they remained focused on delivering our strategic priorities in 2024/25, and wish to extend my gratitude for their hard work and dedication to the business. Finally, I would like to thank our clients for their support and entrusting their business to us. Together, our staff and customers are our lifeblood and will always be our top priority.”
Outlook
The Group traded strongly in financial year 2024/25, while operating in highly competitive markets and despite challenging macroeconomic conditions. Our focus remains on executing our growth strategy by nurturing existing customer relationships, extending our strong vendor partnerships, and leveraging the technical skills of our service delivery teams. We are well positioned to respond to the evolving demands we see in our markets, including cloud computing, cybersecurity, AI and managed services and deliver another year of double-digit gross profit growth together with high single-digit operating profit growth in financial year 2025/26.
Analyst and investor presentation
A presentation for sell-side analysts and investors will be held today at 09:30 (BST) via a video webcast that can be accessed at:
https://sparklive.lseg.com/BytesTechnologyGroup/events/5e028343-b396-4384-a339-1cb2d82ae8eb/btg-plc-full-year-results
A recording of the webcast will be available after the event at bytesplc.com. The announcement and presentation will be available at bytesplc.com from 07:00 and 09:00 (BST), respectively.
