PINNACLE Technology, the IT and telecoms group, said it was a on a “cleaner and more stable” foundation yesterday as it announced two acquisitions for £5 million in cash and shares.
The AIM-quoted business, which was originally founded in Paisley and employs 25 people in Glasgow, said the acquisition of Leeds-based IT support businesses Ancar-B and Weston would help it become a leading provider of ‘IT as a service’ – basically on-demand, subscription-based IT support – to UK small and medium enterprises.
“The acquisitions of Ancar-B and Weston are the first steps in consolidating a highly fragmented market and I look forward to ensuring the organisation is focused on creating both customer and shareholder value,” said Gavin Lyons, Pinnacle’s new executive chairman.
The company, which is struggling to recover from a number of poor acquisitions in the past, also announced that its chief executive Nicholas Scallan would step down from the board with effect from the forthcoming annual meeting.
Final results for the year to end September 2015 show a 5.9 per cent fall in revenues to £7.9m, while losses shrank by more than a quarter to £1.3m. There was a positive cash balance at year end of £641k.
“The board has said repeatedly that turning around Pinnacle Technology will take time, as demonstrated by these results,” said chairman James Dodd.
He added that reduced operating costs, efforts to resolve legacy issues and investment in sales and marketing had helped grow ‘strategically important’ IT and cloud-based revenues. These had all resulted in the business being on a “cleaner and more stable foundation” to make acquisitions, Mr Dodd said.
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