Iomart reports wider adjusted annual loss

23rd Jun 2026 10:01

(Sharecast News) - Iomart reported a wider adjusted loss for the year on Tuesday as churn in legacy private cloud and backup services offset revenue growth from Atech, although the AIM-traded secure cloud services group said second-half profitability had improved and cost savings were on track.

Revenue rose 8% to £154.9m in the year ended 31 March from £143.5m, reflecting a full-year contribution from Atech, but declined organically as customer churn hit private cloud managed services and lower opening run-rate revenues weighed on performance.

Recurring revenue accounted for 86% of the total, down from 89%.

Adjusted EBITDA fell to £25.6m from £34.3m, while adjusted EBIT declined to £5.2m from £12.8m, reducing the adjusted EBIT margin to 3.3% from 8.9%.

Iomart swung to an adjusted pre-tax loss of £4.0m from a £6.5m profit, while its statutory pre-tax loss narrowed to £13.6m from £53.2m, with the prior year including a £52.9m goodwill impairment.

The company said gross order bookings were £20.6m of annual recurring revenue, broadly ahead of the prior year excluding Atech, but were offset by £21.2m of churn, particularly in Microsoft Modern Work offerings and the final legacy backup platform customers.

Net debt rose to £108.6m from £101.9m, although operating cash conversion remained strong at 96% of adjusted EBITDA before exceptional items.

After the year end, Iomart extended its £115m revolving credit facility to 30 June 2028.

Executive chair Richard Last said FY26 had been "a year of transition and repositioning", adding that the group had delivered its £4m annualised cost savings target and entered FY27 with a clearer strategic framework.

The company said it expected a modest revenue decline in FY27, but anticipated an improved profit profile in the second half as cost actions, operational efficiency measures and a focus on higher-value cloud, security and data protection services take effect.

At 0952 BST, shares in Iomart Group were down 18.94% at 14.59p.

Reporting by Josh White for Sharecast.com.

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