However, the firm stressed that it continues to “benefit from a robust business model delivering very strong levels of recurring revenues”, amounting to 93% of group revenues.

According to iomart, the reduction in group revenue reflects lower non-recurring equipment and consultancy sales, along with lower customer renewal levels at the start of the year, which have since returned to normal levels.

Margins remain stable with the firm’s adjusted EBITDA margin and adjusted profit before tax3 margin at 36.9% (2021: 37%) and 16.6% (2021: 17.5%), respectively. Absolute profit reductions follow the revenue profile in the year.

iomart also reported strong cash generation from operations in the period of £37.9m with a consistent cash conversion of 100%, compared to 106% in 2021.

The firm’s year-end net debt was reduced to £41.3m, comfortable at 1.1 times adjusted EBITDA.

iomart also reported successful refinancing with an increased £100m revolving bank facility from a new group of four banks, underpinning the group’s five-year growth strategy.

Reece Donovan, CEO, commented: “We have made good progress on all aspects of our strategic growth plan and start the second year of this plan in an improved position. With an expanded offering and strengthened team, as well as an established reputation within the UK’s cloud computing market place, we have a strong platform from which to return to a growth phase of the business.

“We are mindful that the wider business environment continues to be challenging. As iomart has shown in the past, during periods of uncertainty, we have a robust business model and strong financial position to manage such short-term pressures.

“This is especially the case as the market for cloud computing solutions continues to offer long term growth and our strategic actions taken, together with our M&A plans, puts us in a stronger position to benefit from this over the coming year and beyond.”