LONDON (ShareCast) - (Sharecast News) - Cybersecurity and intelligence services provider Falanx Group issued its audited results for the year ended 31 March on Tuesday, reporting revenues of £3.0m, up from £2.7m, and an improved gross margin of 31%, compared to 20% in the prior year.
The AIM-traded firm said its contribution from monthly recurring revenue increased to 62% of revenue from 55%, with its monthly recurring revenue run rate at 31 March standing at £0.19m, compared to £0.15m a year earlier.

It also said it had "much greater" future revenue visibility in contracted as well as deferred income of £3.0m, rising from £1.8m 12 months ago.

The company's underlying EBITDA loss was £1.6m, widening from £1.2m, wits its reported loss growing to £2.5m from £1.7m, following £0.7m of one-off restructuring and transaction costs.

Cash balances at period end stood at £0.9m, up from £0.4m, while shareholders' funds rose to £4.9m from £0.8m.

The company confirmed it remained debt-free.

On the operational front, Falanx highlighted its acquisition of three technology and cybersecurity-focussed companies, being Cloudified, AuditSec, and First Base, during the year.

It also reported a "substantially increased and diversified" customer base across all lines of service.

During the year, Falanx created new cyber service lines in 'MidGARD Monitoring', 'Threat Awareness Training', and 'Red-Team Testing'.

It also claimed to now have a "significantly strengthened" management team, and said it continued the development of its proprietary cyber technology.

Since the year ended, Falanx said monthly recurring revenue at the end of July had increased to £0.24m.

It said recent acquisitions, combined with contract wins, had approximately doubled pro forma revenues to £6m, placing the business in a "strong position" to exploit growth.

The firm saw EBITDA profitability in July, following strong deliveries.

It also acquired and integrated the trade and assets of First Base Technologies, which the board said provided "significantly increased" cyber assessment and awareness services, with orders up by 25% since the start of January compared to the prior year.

The acquisition of Securestorm had enhanced the company's cyber consultancy, and extended its reach into UK Government in July.

Looking ahead, the board said it had received "favourable indications" from its most significant partners and vendors that its strategy to scale security services was appropriate, and would be supported.

As such, the board said it was targeting a much-improved financial performance for the year.

In addition to its 'business as usual' plan, which the board said combined organic growth and targeted acquisitions that were financially attractive, the group would increase the contribution from high quality recurring revenues, increase its average customer spend through bundled products, increase sales by distributing through large managed service providers, utilise proprietary technology development to drive down cost and add attractive new features, and progress current discussions with several major global enterprises for adoption of its "highly disruptive" cyber technology stack.

"In the past eight months we have: significantly increased revenues through contract wins and acquisitions, restructured our management team, refocussed our strategy, won important and large customer contracts, broken into new markets, acquired and integrated several businesses, built a strong team, forged new channel partnerships, successfully delivered large scale security solutions and deepened our intelligence and security relationships with global clients," said Falanx chairman and chief executive Mike Read.

"Because of all the work done by our energetic and committed team, I am delighted to announce, following strong deliveries, Falanx Group has achieved EBITDA profitability this July, in-line with management expectations."

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