Vianet reaps benefits of 'strong recurring revenues' in H1

Data management firm Vianet Group said on Wednesday that it had started to reap the benefits of its "strong recurring revenues" and "healthy gross margins" in the six months ended 30 September.

Vianet said interim revenues ticked up £100,000 to £7.19m, with recurring revenues rising one basis point to 87%, while first-half gross margins increased from 64% to 69%.

The AIM-listed group delivered a pre-tax loss of £171,000, net of a £200,000 investment into the recently acquired Beverage Metrics. However, on a like-for-like basis, Vianet turned in a pre-tax profit of £29,000 - a marked improvement on the prior year period's pre-tax loss of £106,000.

Vianet noted that its smart machines unit had experienced "modest revenue growth" from 3.0m to £3.05m, something it said was "very encouraging" given industry-wide delays due to the replacement plans for 3G being finalised.

Chief executive James Dickson said: "Over the past three years, the Group has strategically and deliberately taken actions aimed at reclaiming the Company's pre-Covid position and seizing the opportunities that emerged from the pandemic. Our investments in sales, technology, new market verticals, expanded product lines, and collaborations provide a solid platform for growth.

"As a result, the Group remains exceptionally well-positioned to continue to deliver growth in recurring revenues and earnings, generate strong free cash flow and distribute dividends. As we continue to execute our long-term strategic plan and explore future strategic opportunities for Vianet, I look forward to the future with much optimism and confidence."

As of 1135 GMT, Vianet shares were up 2.21% at 64.90p.

Reporting by Iain Gilbert at Sharecast.com