Gamma Communications Plc · LSE:GAMA
Gamma Communications — H1 2025 Earnings Presentation
32 slides from Gamma Communications's earnings presentation, Sep 9, 2025
Slide 1: Gamma Half Year 2025 Results
Gamma Half Year 2025 Results 9 September 2025 Andrew Belshaw, CEO Bill Castell, CFO #GoodTogether
Slide 2: Agenda
Half Year 2025 Business Update 01. Andrew Belshaw Half Year 2025 Results How does Gamma add value to our customers? 02. Andrew Belshaw Update on Market Trends Agenda 03. Andrew Belshaw Half Year 2025 Financial Highlights 04. Bill Castell Business Outlook 05. Andrew Belshaw Q&A 06. Andrew Belshaw and
Slide 3: Half Year 2025 Business Update
Half Year 2025 Business Update Andrew Belshaw, CEO
Slide 4: Half Year 2025 Financial Overview
Half Year 2025 Financial Overview Gamma Group Business Enterprise Germany Other Europe £316.6m £186.0m £66.5m £49.1m £15.0m +12% growth +1% growth +9% growth +125% growth (4% decline) Gamma Group revenue* 59% of Group revenue 21% of Group revenue 16% of Group revenue 4% of Group revenue o Full Year
Slide 5: Half Year 2025 Business Update
Half Year 2025 Business Update Gamma Business – Growth in volume and solutions o Substantial progress with new Portal architecture, allowing UK Channel Partners to order Horizon, PhoneLine+, Cisco Collaboration Suite and iPECS through a single portal o Continued volume growth of 23k (up 2%) in Cloud
Slide 6: How does Gamma add value to our customers?
How does Gamma add value to our customers? Andrew Belshaw, CEO
Slide 7: Gamma is in a strong position
Gamma is in a strong position All businesses need a communications provider Market leading position in the UK and Germany 90% recurring revenue with a predictable outlook, and a consistent 50%+ gross profit margin across the Group Highly cash generative, with 90% adjusted cash conversion and strong
Slide 8: Gamma's Unique Position
Gamma’s Unique Position Network operator Key to enable calling Local Global tech giants distribution and large partners reach Quality of service Predictability for partners and customers 8
Slide 9: Gamma offers solutions which all businesses need to function
Gamma offers solutions which all businesses need to function Cloud Communications Calling Connectivity 9 9
Slide 10: Company Name: Morrisons
Company Name: Morrisons Sector: Retail March 2024: December 2024: April 2025: Connectivity Cloud Communications Securing Connectivity 10
Slide 11: Company Name: Lexington & Co. Solicitors
Company Name: Lexington & Co. Solicitors* Sector: Legal Services Starting point: a single office, basic ISDN lines, and siloed use of Microsoft Teams New services: What we’ve done to date • Make Lexington more secure • More efficient • Increase Gamma profitability *Hypothetical customer 11
Slide 12: Update on Market Trends
Update on Market Trends Andrew Belshaw, CEO
Slide 13: Gamma's Growth Drivers
Gamma’s Growth Drivers Macro Market Execution Customers are requiring more complex communications solutions which we are able to address due to our broad suite of solutions. New portal is making it easier for Gamma to add new solutions and easier for channel partners to consume them for end users. P
Slide 14: Exciting Growth in Germany
Exciting Growth in Germany Gamma’s Market Future position today potential possibilities Proforma* revenue Proforma* EBITDA • Further consolidation through £53.7m £10.9m acquisition Half Year 2025 Half Year 2025 Business • Launch Operator Connect to accelerate Communications Microsoft Teams take-up C
Slide 15: Half Year 2025 Financial Highlights
Half Year 2025 Financial Highlights Bill Castell, CFO
Slide 16: Half Year 2025 Financial Highlights
Half Year 2025 Financial Highlights Revenue Adjusted EBITDA Adjusted EPS (FD) Up Up Up 12% 14% 13% to £316.6m to £70.9m to 47.9p Adjusted cash generated by Net debt Shareholder returns operations £(21.6)m £63.7m Interim dividend up 90% As of 31 Dec 2024 14% Adjusted cash conversion net cash of £153.
Slide 17: Income Statement
Six months ended Income Statement £m Revenue 30 June 2024 282.5 30 June 2025 316.6 Growth 25 vs 24 12% Cost of sales (136.7) (144.6) • Recurring revenue grew to £285.3m, 90% of total revenue (2024: 89%) Gross profit 145.8 172.0 18% Gross profit margin 51.6% 54.3% • Gross margin increasing to 54% (20
Slide 18: Gamma Business
Gamma Business YoY growth: +1% Organic growth: +1% • Delivered 1% growth in revenue Revenue (£m) 184.1 186.0 – Solid volume growth in Cloud Communication (+23k seats), with more customers opting for lower price solutions. • Gross profit was flat – Migration of Connectivity products from higher-margi
Slide 19: Gamma Enterprise
Gamma Enterprise YoY growth: +9% Organic growth: +3% 66.5 • Delivered 9% revenue growth Revenue (£m) 61.0 – BrightCloud, a Cisco CX provider acquired in July 2024, contributed £3.6m revenue and £2.0m gross profit on an inorganic basis • Organic gross profit was flat – Lower margin ethernet renewals
Slide 20: Germany & Other Europe
Germany & Other Europe YoY growth: +125% • Following the acquisitions of STARFACE and Germany Revenue (£m) 49.1 Placetel, Germany represents 79% of Europe and 20% of the Group, based on H1 2025 gross profit 21.8 • Gross profit of £34.4m includes £24.9m from Placetel and STARFACE H1 2024 H1 2025 – Bo
Slide 21: Strong Balance Sheet
Balance Sheet as at 30 June 30 June 31 December Strong Balance Sheet (£m) Non-current assets (incl. PPE) 2024 218.7 2025 466.0 2024 246.9 • Net debt is low at £21.6m (H1 2024: net cash Receivables and inventories 134.9 137.0 127.4 £142.9m) considering the STARFACE acquisition and Cash 142.9 25.2 153
Slide 22: Cashflow
Cashflow Cash Flow Statement (£m) H1 2024 H1 2025 Growth Adjusted EBITDA 62.2 70.9 14% Cash generated by operations 59.6 53.1 -11% • Cash conversion remained healthy at 90%, with higher Add back: Cash impact of exceptional items 2.2 6.5 working capital outflows in the period Add back: Cash impact of
Slide 23: Walk through of Half Year 2025 adjusting items
Walk through of Half Year 2025 adjusting items 5.1 2.2 0.8 - - 70.9 64.2 (1.4) EBITDA (£m) 0.8 - 1.7 1.6 63.7 5.1 1.4 53.1 Operating cashflow (£m) Placetel STARFACE STARFACE FX on Unadjusted ERP employee maintenance Adjusted acquisition Listing costs deferred measure implementation obligation revenu
Slide 24: Modelling considerations
Modelling considerations • The Board expects Adjusted EBITDA to be in line with the range of current market expectations* and Adjusted EPS slightly ahead, for the year ending 31 December 2025. • Adjusted operating cash conversion to remain at ~90% • Capex expected range of £21m - £24m for FY25 • One
Slide 25: Business Outlook
Business Outlook Andrew Belshaw, CEO
Slide 26: Business Outlook
Business Outlook • Confidence in outlook for FY25 • Good visibility and predictability in outlook for FY26, despite short-term, one-off headwinds (PSTN switch-off and Ethernet competitiveness), which can be offset by: – Growth initiatives – Restructuring due to operational efficiencies 26
Slide 27: Medium-term Growth Drivers
Medium-term Growth Drivers Strong and growing solution set– new PhoneLine+ variants, Contact Centre offerings, wide Ten years+ of growth forecast in German market choice of fibre providers; AI embedded “Edge” proposition – combining AI tools with our large quantities of data to develop Expansion of
Slide 28: Gamma is in a strong position
Gamma is in a strong position All businesses need a communications provider Market leading position in the UK and Germany 90% recurring revenue with a predictable outlook, and a consistent 50%+ gross profit margin across the Group Highly cash generative, with 90% adjusted cash conversion and strong
Slide 29: Thank you.
Thank you. #GoodTogether
Slide 30: Calling – Performance (Growth vs Dec 2024)
Calling – Performance (Growth vs Dec 2024) SIP Trunks Enabling SIP Trunks Enabling MS Teams Enablement Traditional Hardware PBX non-Gamma Cloud PBX Down Up Up UK 3% 4% 12% to 902k SIP Trunks to 498k SIP Trunks to 523k users SIP Trunks Enabling SIP Trunks Enabling MS Teams Enablement Traditional Hard
Slide 31: Cloud Communications – Performance (Growth vs Dec 24)
Cloud Communications – Performance (Growth vs Dec 24) Cloud PBX seats CCaaS seats Up Up UK 2% 7% to 1,063k cloud seats to 48k CCaaS seats Cloud PBX seats CCaaS seats Europe Up Up 58% 0% to 687k cloud seats to 5k CCaaS seats 31
Slide 32: Half Year 2025 sources and uses of cash
Half Year 2025 sources and uses of cash 300 250 Closing cash balance • Acquisition cashflows were largely driven by the Borrowings Other (e.g. Leases) £152.2m outflow for STARFACE Capital expenditure Taxes paid • £57.2m was returned to shareholders in the period 200 Cash Paid to through a combinatio