Cirrus Networks Govt., resources wins fuel record half year
Managed services provider Cirrus Networks has posted a record half year result off the back of contract wins from government and the resources sector.
In the six months ended 31 December 2020, Cirrus reported revenue of $53.8 million, up 13 percent year over year. EBITDA is also up 29 percent year over year at $1.1 million.
The company also returned to profitability with $1 million in net profit after tax, compared to a $244,000 loss in H1 FY20.
The increase in earnings was credited to strong growth in the Canberra market, which saw 122 percent revenue growth during the period. Some wins include larger agencies like Defence, Services Australia, Department of Home Affairs and Austrade.
Cirrus said contract wins from WA-based resources companies also contributed to the increase.
On a per segment basis, services revenue grew 5 percent while product sales revenue increased 15 percent during the period. Services gross margin is also up 11 percent.
“The company has again delivered both solid H1 revenue and earnings growth year on year which is very pleasing in an environment of continued uncertainty. To deliver consistent revenue growth while improving profitability is a credit to our quality staff and their ability to meet and exceed the client expectations,” Cirrus managing director Matt Sullivan said.
“Of particular note is the 122 percent growth in revenue from our key Canberra market. This together with the ongoing and increasing revenue and earnings contribution from managed and professional services demonstrates Cirrus’ evolution into a market leading and innovative national IT managed service provider of choice. Our strategic focus in the short to medium term is annuity and outsource services where we see a strong pipeline of qualified opportunities.
“The growth in services contribution, coupled with a growing geographically diversified revenue base, provides confidence to deliver another record revenue and earnings year in FY21.”
Looking ahead, Cirrus expects growth to continue with a strong pipeline of contracts in both Government and the WA resources sector. It also expects its Melbourne office to bounce back following the impacts from recent lockdowns during H1 FY21.
Guidance for EBITDA for the full FY2021 is expected to be between $4.2 million to $4.6 million.