Vianet returns to profits, reinstates dividend

(Sharecast News) - Hospitality, vending and remote asset management data specialist Vianet Group reported a strong half-year financial and operational performance on Tuesday, as it returned to profitability, reinstated its interim dividend, and reaffirmed its confidence in achieving full-year growth targets.

The AIM-traded firm said revenue for the six months ended 30 September increased 7% to £7.69m, compared to £7.19m a year earlier, reflecting consistent growth across its key divisions.

Recurring revenue accounted for 84% of total income.

Adjusted operating profit rose 10.1% to £1.43m, while EBITDA increased 26.6% to £1.55m.

The company posted a pre-tax profit of £18,000, swinging from the £171,000 loss it recorded in the same period last year.

Vianet also strengthened its balance sheet, reducing net debt to £1m from £2.09m in the first half of 2024 and increasing cash reserves to £2.25m.

Reflecting confidence in its financial position, the board reinstated the interim dividend at 0.3p per share.

In the hospitality sector, Vianet said it achieved revenue growth of 7.3% to £4.45m.

The integration of the Beverage Metrics platform enhanced the company's market presence in the UK and the US, while the launch of its Enersave beer cooling energy management solution added further innovation to its product portfolio.

Contract renewals were noted with major clients such as Heineken's Star Pubs and Greene King.

The unattended retail division also delivered robust results, with revenue increasing 6.2% to £3.24m.

Vianet expanded its operational estate by 7.5% to over 37,000 units and secured 48 new long-term contracts, benefiting from competitor withdrawals in the market.

The company said it capitalised on the ongoing transition from 3G to 4G technology, delivering over 2,600 new contactless payment units and upgrading more than 1,000 devices.

Strategic collaborations in the UK and the US continued to enhance opportunities in the vending, fuel forecourt, and broader retail sectors.

Looking ahead, Vianet said it was well-positioned to achieve sustained growth despite ongoing challenges in the hospitality market.

"Our operational cash generation remains a highlight, with £1.92m generated after working capital adjustments, representing 124% of EBITDA," said chief financial officer Mark Foster.

"This strong cash conversion, coupled with reduced net debt underpins our robust financial position.

"Exceptional costs decreased to £0.11m, reflecting lower restructuring and acquisition expenses compared to the first half of 2024."

Foster said the company's improved banking facilities had enhanced its financial flexibility, supporting ongoing operations and growth initiatives.

"Looking ahead, we are confident that our investments in technology, strategic acquisitions, and new market opportunities will continue to deliver strong financial results."

At 1216 GMT, shares in Vianet Group were up 7.01% at 103p.

Reporting by Josh White for Sharecast.com.