SOFTCAT plc
(‘Softcat’, the ‘Group’)
Preliminary results for the year ended 31 July 2024
Strong operating and financial performance drives another year of profitable organic growth alongside investment in strategic priorities
Softcat plc (LSE: SCT.L), a leading UK provider of IT infrastructure products and services, today announces full year results for the twelve months to 31 July 2024 (‘the period’). These results reflect another year of strong growth and cash generation, enabling continued investment to ensure we are best placed to take advantage of the significant opportunity our market presents.
| Financial Summary | Year ended | ||
| 31 July | 31 July | ||
| 2024 | 2023 | Change | |
| £m | £m | ||
| Gross invoiced incomea | 2,852.2 | 2,563.3 | 11.3% |
| Revenueb | 962.6 | 985.3 | (2.3%) |
| Gross profit | 417.8 | 373.8 | 11.7% |
| Operating profit | 154.1 | 140.9 | 9.3% |
| Cash conversion %c | 95.9% | 93.2% | 2.7pts |
| Total ordinary dividend (p) | 26.6p | 25.0p | 6.4% |
| Final dividend (p) | 18.1p | 17.0p | 6.5% |
| Special dividend (p) | 20.9p | 12.6p | 65.9% |
| Basic earnings per share (p) | 59.7p | 56.2p | 6.2% |
Highlights for the year ended 31 July 2024
| ● | Another year of strong performance, delivering double-digit growth in gross invoiced income and gross profit. |
| ● | Operating profit growth of 9.3% alongside continued investment in our market opportunity, including average headcount growth of 14.3%. |
| ● | Further development of our technology and service proposition as we continue to scale, making it easier for customers and vendors to do business with Softcat and reflecting industry trends including data and AI. |
| ● | A final ordinary dividend of 18.1p, resulting in a full year dividend of 26.6p, up 6.4%, together with a special dividend of 20.9p. |
| ● | Strong balance sheet position with cash conversion of 95.9% (FY2023: 93.2%), and cash and cash equivalents of £158.5m (FY2023: £122.6m). |
| ● | Outlook: We expect to deliver another year of double-digit gross profit growth together with high single-digit operating profit growth in FY2025. |
a Gross invoiced income reflects gross income billed to customers adjusted for deferred and accrued revenue items. This is an Alternative Performance Measure (APM). For further information on this, please refer to the CFO Report on page 8.
b Revenue is reported under IFRS 15, the international accounting standard for revenue. IFRS 15 requires judgements be made to determine whether Softcat acts as principal or agent in certain trading transactions. These judgements, coupled with slight variations of business model and contractual arrangements between IT Solutions Providers, means the impact of IFRS 15 across the peer group is not uniform. Income prior to the IFRS 15 adjustment is referred to as gross invoiced income, which is an Alternative Performance Measure (APM).
c Cash conversion is defined as net cash generated from operating activities before tax but after capital expenditure, as a percentage of operating profit. This is also an Alternative Performance Measure. For further information on this, please refer to the CFO Report on page 8.
Graham Charlton, Softcat CEO, commented,
“I’m delighted to report another record year for Softcat, delivering strong growth ahead of market expectationsa despite challenging market conditions. These results are testament to the power of our culture and our continued ability to deliver high quality value to customers just when, more than ever, they need our help to navigate the increasing pace of technological change.
During the year we made further progress against our two key strategic goals: expanding our position with existing customers whilst also adding to our customer base. We also continued to evolve our technology and service proposition, reframing and strengthening our offer to enable further strategic progress in the years to come. The investment we have made in our team, growing headcount by more than 30% over the past two years, puts us in an incredibly strong position for when economic conditions improve. We have the capacity and skills to be the best possible partner for our ten thousand customers as they continue to transform their technology in the years ahead.
The Group’s financial position is as strong as ever, with cash generation continuing to support our progressive ordinary dividend and once again also enabling the recommendation of a special dividend.
As always, I’d like to give a heartfelt thank you to the Softcat team for their outstanding attitude and dedication to each other, our customers and our partners during the past year. Their spirit and ability create an unbeatable foundation upon which we will continue to build as we drive towards our full potential in the years ahead.”
Outlook
Softcat operates in a significant and growing market, and we continue to invest to capitalise on this exciting growth potential. As we drive further market share gains, we expect to deliver another year of double-digit gross profit growth together with high single-digit operating profit growth in FY2025.