AUS
NZ
UK
CA
USA
IND
Highlights:
- Strong Financial Performance: Adjusted EBITDA expected within market consensus and Adjusted EPS in the upper half, showcasing healthy year-on-year growth.
- Major Acquisition: Agreement to acquire STARFACE, a German IP telephony solutions provider, for €196m, further enhancing Gamma's position in Europe.
- Main Market Move: Gamma reaffirms its plan to transition to the London Stock Exchange's Main Market by Q2 2025.
Gamma Communications plc (LSE:GAMA), a leading provider of technology-driven communication services across Europe, has released its trading update for the financial year ending 31 December 2024. The company reports solid performance, driven by robust organic growth and strategic acquisitions, with results expected to align with market consensus.
UK and European Operations
Gamma’s UK operations saw significant growth across both its Business and Enterprise units:
- Business Unit Growth: Achieved over one million cloud seats, driven by positive net additions across its cloud and connectivity products.
- Enterprise Success: Secured notable contracts with high-profile clients, including Morrisons Supermarkets, Dorset NHS, and Westminster City Council, despite a competitive market landscape.
In Europe, performance remained steady on a constant currency basis, bolstered by organic growth in Germany and the acquisition of Placetel.
Acquisition of STARFACE
Gamma has reached an agreement to acquire SF Technologies Holding GmbH (trading as STARFACE) for €196m on a debt-free, cash-free basis, subject to regulatory clearance. STARFACE is a leading provider of IP telephony solutions for SMEs in Germany. The acquisition will be funded through £125m from Gamma’s cash reserves and £40m from a new £130m multicurrency Revolving Credit Facility.
Financial Health
Gamma's closing net cash balance as of 31 December 2024 increased to £153.7m (2023: £134.8m), driven by strong operating cash flow. The company has also completed the acquisitions of Coolwave and BrightCloud and concluded a share buyback program during the year.
The new Revolving Credit Facility, with a three-year term and a 12-month extension option, leaves £90m undrawn for future investments, aligning with Gamma's balanced capital allocation strategy.
Transition to the Main Market
Gamma has reaffirmed its commitment to moving to the Main Market of the London Stock Exchange by Q2 2025. Relevant workstreams are progressing as planned, and further updates will be provided with the annual results announcement scheduled for 25 March 2025.
