Skillcast Group Reports Strong H1 2025 Results with 18% Revenue Growth
Why we think this is good
The financial results show significant improvements across key metrics. Revenue grew by 18% to £7.5m, with subscription revenue up 23%. Profitability saw a marked increase, with EBITDA rising from £0.03m to £0.7m, and EBITDA margin improving from -0.5% to 9.0%. Cash position strengthened considerably, increasing from £8.3m to £11.5m, while free cash flow more than doubled to £2.2m. These positive financial indicators demonstrate strong execution and operational efficiency. However, the mention of 'challenging market conditions' and a 'competitive landscape' in the outlook tempers the enthusiasm somewhat, suggesting potential headwinds in the future. The company's valuation, while not excessive, is relatively high, which may limit short-term upside potential. Overall, the strong financial performance outweighs the cautionary outlook, resulting in a 'GOOD' sentiment score.
Key Points
- Revenue grew 18% to £7.5m, with subscription revenue up 23%
- EBITDA increased to £0.7m from £0.03m in H1 2024
- EBITDA margin improved from -0.5% to 9.0%
- Cash at bank increased to £11.5m from £8.3m
- Free cash flow more than doubled to £2.2m
- Annual Recurring Revenue (ARR) grew 23% year-on-year to £12.8m
- Gross profit margin increased from 71.7% to 75.5%
- Number of revenue-generating clients increased by 7%
- Interim dividend declared at 0.202 pence per share, up 20% from last year
- Company noted challenging market conditions and competitive landscape in outlook
Summary
Skillcast Group PLC reported strong H1 2025 results, demonstrating significant growth and improved profitability. Revenue increased by 18% to £7.5m, driven by a 23% growth in subscription revenue. The company saw a substantial improvement in profitability, with EBITDA rising to £0.7m from £0.03m in the same period last year. EBITDA margin improved from -0.5% to 9.0%. The company's cash position strengthened considerably, with cash at bank increasing to £11.5m from £8.3m, supported by free cash flow of £2.2m. Annual Recurring Revenue (ARR) grew by 23% year-on-year to £12.8m. Despite these positive results, the company noted challenging market conditions and a competitive landscape, which could impact future growth. The company's valuation, while not excessive, is relatively high, which may limit short-term upside potential.