Former Novosco business triples profits after German take-over
BELFAST-based managed cloud IT services firm Cancom (formerly known as Novosco) continued to expand last year as its revenues grew by 26 per cent to more than £42 million, its latest accounts show.
The company's pre-tax profits more than tripled from just over £1 million in 2018 to £3.7 million last year.
And average employee numbers also increased by 40 per cent from 172 to 228, expanding the service delivery and technical teams to support growth in managed cloud services.
The figures came in the same year that Munich-headquartered Cancom paid £70 million to acquire Novosco, which was established in Belfast more than a decade ago by Patrick McAliskey and John Lennon.
The Frankfurt stock exchange-listed tech group, which as well as its home country is established in Austria, Switzerland, Belgium, Slovakia, Britain and the USA, had revenues last year of €1.549 billion (about £1.3 billion) and a global workforce of more than 4,000.
As part of its take-over of Novosco last October, Mr Lennon took on the role of joint managing director of Cancom UK while Mr McAliskey continues to hold shares in the company and acts as an adviser to Cancom.
As well as its stellar growth last year, Cancom's Belfast operation has traded strongly during the pandemic.
In a report with the results the directors say: "The nature of the our business and our ability to deliver services remotely has enabled us to continue to trade strongly throughout the crisis.
"We do not consider the impact of the pandemic to be severe in relation to this company in the long term.
"Employees have all worked from home and none were placed on furlough. New processes have been implemented for a return of office and safeguarding the health and safety of employees."
In July the company acquired the business and assets of Cancom Communications and Collaboration Ltd as a going concern for consideration of nett asset value to be held on inter-company account.
A dividend of £10 million was declared by the company to Novosco Group Ltd on September 15 and has subsequently been paid.
The accounts show that profits after tax rose from £314,100 in 2018 to £2,838,417 last year.
But the company also benefitted from a tax credit of £1,386,615 for equity share-based payments, which gave it a total comprehensive income for the year of £4,225,032.
During 2019 Cancom Managed Services disposed of its investment in Cloudstream Ltd, which translated to a loss of £219,434.
The company's wages bill last year came in at £14,828,565, which on a simple calculation based on its 228 employees means it was paying an average salary of more than £65,000.