Cirrus Networks kicks off reporting season with a solid 1HY23 result

Nick Sundich, February 2, 2023

IT services company Cirrus Networks (ASX:CNW) is one of the first companies to release its 1HY23 results. To say shareholders were impressed by the results would be an understatement, judging by this morning’s initial 23% share price jump.

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Cirrus Networks is benefiting from strong demand for IT services

Cirrus Networks is a Managed Services Provider (MSP) that targets mid-market enterprises.

MSPs deliver IT services, such as network, application, infrastructure and security, via ongoing and regular support as well as active administration wherever the customer needs it.

Spending on IT services by Australian companies is expected to grow from $37bn in 2021 to $43.5bn in 2025, representing a CAGR of 4.1%.

Cirrus Networks (ASX:CNW) share price chart, log scale (Source: TradingView)

A good 1HY23 result

In 1HY23, Cirrus recorded $56.7m in revenue (up 27%), $2.2m in EBITDA (up from an $0.4m loss in 1HY22) and a $1.3m pre-tax profit (up from a $2.2m loss in 1HY22). The company closed the period with a healthy balance sheet, with $9.5m in cash and zero debt.

Cirrus Networks credited the market demand, its strong market position and more disciplined focus on overhead spend for its good results. It guided to a strong 2HY23 as well.

The company’s share rose by more 20% this morning, which bodes well for shareholders of other ASX companies that are anticipating solid results over the next few weeks.