Cerillion's profits cut despite 'good progress' and revenue gains

Business software outfit Cerillion said that its lower profits failed to reflect an increase in annual revenue as costs increased with the establishment of a new London office.

Over the year ended 30 September the billing, charging and customer relationship management software solutions provider’s revenue increased by 8.2% to £17.4m but operating profit fell by 10.3% to £1.9m as cost of sales increased by a quarter.

Profit before tax dropped by 10% to £1.8m after the AIM traded company moved its London offices due to overlapping rental periods, though chief executive Louis Hall said that Cerillion had grown in line with market expectations after making “good progress”.

Louis Hall, chief executive of Cerillion, said: "Three large enterprise customer implementations for our core product remain underway, with completion scheduled in 2019. We also started pilot work for a potential fourth, new enterprise customer in the final quarter of the financial year, and there are two further potential large orders, which are likely to be decided over the coming months."

At the financial year end new orders stood at £13.0m, down from £13.5m last year, most of which are in progress.

"With a strong new customer pipeline, the ability to continue to rollout new and enhanced product modules, and continuing recognition by industry analysts, we believe the company is well placed for continuing positive progress," said Hall.

At 30 September cash and cash equivalents stood at £5.3m, unchanged from the previous year, while the final dividend proposes was 3p per share, bring the total dividend up 7.1% over last year.

Cerillion’s shares were unchanged at 145.00p at 0846 GMT.