SysGroup, a managed service player, has released its half-year results, revealing a mixed picture but also some promising developments for the business. Revenues for the six months ending on September 30th declined by $3 year-on-year to £10.96m, while pre-tax profits reached £0.99m. However, managed services revenues saw an 8% improvement, now accounting for 84% of the company’s total business.
During this period, SysGroup also underwent some management changes, including the appointment of Heejae Chae as executive chair and Paul Edwards as a new non-executive director.
The first half of the year also saw the company increase its investment in the hardware supporting its SysCloud infrastructure. Additionally, SysGroup embarked on a fresh strategy to deliver more artificial intelligence (AI) and machine learning (ML) solutions, investing in an engineering team to support this ambition.
Chae, in his comments accompanying the results, emphasized the areas where the company is investing in future growth. He stated, “Our strategy aims to position SysGroup as the go-to end-to-end data solution provider for small and medium-sized businesses [SMBs] embarking on their AI/ML journey. AI’s prominence is undeniable, with daily media coverage and increasing demand for AI strategies at the board level of every company.”
Recognizing a significant market gap, Chae added, “While many SMBs are eager to adopt AI/ML, they often lack a clear strategy or implementation path. There is a great demand for a partner to support their development of an AI/ML strategy and transition from the current platform.”
SysGroup’s conviction that AI and ML will be areas for growth in the second half of the year and beyond is supported by the moves made during H1. Chae highlighted significant investments in technology and people, including the recruitment of a team of ML engineers from industry leaders such as AWS, JP Morgan, Validus, and McLaren. The company also strengthened its senior management team to drive its AI/ML journey.
Chae also noted the growing revenues from managed services, which provide a solid base for expansion. With over 80% recurring revenues, SysGroup has good revenue certainty and visibility. Chae acknowledged that the company’s overall bottom-line performance may be marginally impacted in the short term due to investment in driving future revenue growth.
SysGroup is focused on reinforcing a culture of customer focus and outstanding service, underpinned by innovation, entrepreneurialism, and high performance. While still in the early stages of its journey, the company is excited about the potential it is building and the considerable unexploited market opportunity that lies ahead.