Vianet trades in line with board expecting maintained dividend

Actionable data and business insights provider Vianet Group updated the market on its trading on Wednesday, reporting that trading in the second half of the year was largely as anticipated and, as a result, its full-year profits would be broadly in line with market expectations and ahead of last year's outturn of £3.32m.

The AIM-traded firm said that as a result, it intended to recommend a maintained final dividend of 4p per share.

It said its Smart Machines division continued to deliver growth in connected devices and penetration into the European market.

The integration of the recent Vendman acquisition and bedding in of the material contract win with a global coffee company were both said to be both going “well”, as was progress on increasing the proportion of recurring revenue as a percentage of new sales.

Whilst Smart Machines revenue stream transitioned from capital sales to recurring annuity suppressed short term financial performance, the board said it was providing greater visibility and quality of future earnings for this division.

The Smart Zones divisional contribution was slightly down year-on-year, the Vianet board admitted.

However, investment in pubco data analytics capability and its increased automation of transactional processes would help to sustain future contribution despite the challenges faced in its customers' core market of UK pub retailing.

“The group will again deliver good year-on-year profit growth,” said chairman James Dickson.

“Importantly, this has been achieved whilst shifting the balance of Smart Machines sales from capital to recurring annuity based income.

“The group's medium to long term prospects are exciting, particularly for telemetry and payment solutions for the coffee vending market, where momentum is being boosted by good progress integrating the Vendman acquisition, and better visibility on delivery of the material contract win with a global coffee company.”

Vianet said it expected to release its preliminary results for the year ended 31 March on 5 June.