ONE of the big players in Dorset’s IT scene has bought another locally-based firm at the same time as announcing a loss.
CORETX, which has offices and a data centre in Westbourne, announced it had bought 365IT in a deal that values the business at £5.4million.
CORETX, which provides cloud and managed IT services, was created from the acquisition of two business in early 2016 – Selection Services and the Westbourne-based C4L. It has revealed a pre-tax loss of £4.1m for 2016.
Its latest acquisition 365IT is based in Riseley and Poole, where it bought another firm, Deverill Group Ltd, only last April. The company employs 110 staff.
Jonathan Watts, non-executive chairman of CORETX, said 365IT was “highly complementary on both a product and service level as well as geographically”.
CORETX bought the company from LMS Capital and said it expected the deal to be “earnings enhancing” in the first full year.
Mr Watts said: “365IT has a very strong IT services pedigree, with excellent voice, unified communications and cloud capability which we believe will accelerate CORETX’s presence in these high growth areas and enable us to provide our customers with a broader and more comprehensive offering.”
CORETX reported earnings before tax and adjustments of £4.9m but a pre-tax loss of £4.1m and a loss attributable to shareholders of £3.4m.
Mr Watts said the group increased its revenue and margins. The group was “cash generative” in the second half of the year and “all key metrics showed an improved performance in the second half of the year over the first, reflecting underlying improvement in operations”.
He said the business was “well positioned to become a leading provider of cloud and managed IT services to the UK mid-market”.
His chairman’s statement went on: “The group has started 2017 in line with expectations and there is a healthy pipeline of opportunities within the existing customer base and with new prospective customers.”
Mr Watts said: “With two acquisitions, the focus has been on integration whilst maintaining an unwavering focus on customers and our ability to best support their needs. With a new leadership team and a clearly defined strategy, we believe we are well positioned to drive both further organic and acquisitive growth, the latter evidenced by the post-period end acquisition of 365 ITMS Limited.”
C4L founder Matt Hawkins and chief executive Simon Mewett initially stayed with CORETX as chief technology officer and chief operations officer, but have both since moved on.