Profits and sales up at SciSys but it stays cautious in tough markets

September 29, 2011

Major contract wins from the BBC, the Environment Agency and the European Space Agency helped push up half-year sales and profits at specialist IT services group SciSys.

The new business also helped the Chippenham-based group improve its margins at a time when public spending cuts are impacting on many of its markets.

Pre-tax profits rose by 83% to £1.1m in the six months to June 30 against the same period last year with revenue up 5% to £22m.

SciSys supplies high-end IT services and to business-critical IT systems to the space, government, defence, environment and media/broadcast sectors.

While its clients are predominantly blue-chip companies, government and quasi-government organisations, the group has not been immune from tighter budgets and spending cuts.

But the contract success with media groups such as the BBC, for which it is working at the corporation’s new Salford headquarters, with the European Space Agency on the Galileo test satellites and the Environment Agency on carbon reduction programmes proved, according to chairman and founder Mike Love that the group was moving forward.

“The message on the cover of our 2010 annual report said that we were building momentum,” he said.

“It is in this context that I am pleased to report at the half year point in 2011 that revenues and profits are in line with our expectations for the full year. This reiterates that the group is moving forward positively taking gradual but sustained steps to improve its margins.

“Nevertheless we remain cautious because the discretionary spending cuts and delayed decisions on new contract awards by the UK Government that we mentioned last year are still affecting the UK SITS sector.

“We are not immune but, with half of our revenues coming from outside the UK, we are managing this impact through the diversity of our customer base.”

So far this year the group has won contracts with an underlying value of more than £20m and its environment and government & defence divisions have completed a number of major projects.

Broker Canaccord Genuity said the results were in line with market expectations and consistent with its full-year forecasts of a £2.1m pre-tax profit from sales of £45m.


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