Iomart shares sink after swing to loss amid customer churn
Iomart Group PLC shares slumped on Tuesday as it swung to an adjusted loss and said it expects a ‘modest decline’ in full-year revenue.
The Glasgow, Scotland-based cloud computing and IT-managed services provider said its pretax loss narrowed to £13.6 million in the financial year to the end of March 2026 from £53.2 million a year earlier.
The previous year’s reported loss was impacted by a £52.9 million goodwill impairment charge.
Iomart swung to an adjusted pretax loss of £4.0 million from an adjusted pretax profit of £6.5 million.
Adjusted earnings before interest, tax, deprecation and amortisation fell 26% to £25.6 million from £34.3 million.
Shares in Iomart sank 19% to 14.65 pence on Tuesday morning in London.
Revenue was up 8.0% to £154.9 million from £143.5 million, while cost of sales jumped 18% to £86.4 million from £73.0 million.
On an organic basis, Iomart said revenue declined, mostly driven by customer churn in private cloud managed services alongside the impact of lower opening run-rate.
Looking ahead, Iomart said it expects a ‘modest decline’ in full year revenue.
However, the company said it expects an improved profit profile in the second half of financial 2027, reflecting ‘the benefits of cost base actions and an increased focus on higher-value, strategically aligned services’.
Executive Chair Richard Last said: ‘The group has taken decisive steps to redefine its operating model, enhance business unit accountability and position the business for sustainable long-term growth.
‘The financial results reflect the ongoing transition away from legacy technologies, with churn, particularly elevated in the final quarter, weighing on near-term performance. However, we have maintained strong cash generation, refreshed our banking facilities, and entered FY27 with a clearer strategic framework and more defined business unit structure to drive better performance and focus on distinct growth areas.’
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