Netcall leaps as profits buoyed by cloud services growth

Netcall's shares climbed on Tuesday after the company's interim profits jumped by almost 50% on the back of major growth for cloud services and product bookings.

For the six-month period ended 31 December the customer engagement software provider recorded profit before tax of £0.42m, up 49% compared to the same period the year before, as revenue jumped by 6% to £11.4m.

The revenue increase was driven by a 96% increase in cloud services and product bookings to £5.2m, with cloud service bookings exceeding product sales for the first time, meaning that subscription fees comprised a larger portion of revenue.

Total annual contract values (ACV) at the end of the period were up 10% to £15.1m, with Low code ACV up 40% compared to the year before.

Henrik Bang, chief executive at Netcall, said: "We are now approaching a clear inflexion point in our transition from a traditional software business to a high growth digital cloud operation, with our cloud service bookings exceeding product sales. The increase in our total ACV and Low-code ACV provides a clear demonstration of the growing forward visibility of our revenue streams."

Cash and cash equivalents at the period end stood at £5.8m, up from £5.7m at the same point the year before.

"Trading is in line with our expectations for the year so far. We expect revenues for the year to be more weighted toward the second half given the move to a recurring revenue model and the timing of product sales. Our strong sales momentum has continued into the second half with order inflow significantly ahead compared with the same period last year," said Bang.

Netcall's shares were up 12.91% at 34.10p at 0902 GMT.