IOMART, the cloud computing specialist, has hailed the potential for its business arising from the growth of cyber attacks, as it reported a hike in profits in its last financial year.

Glasgow-based Iomart reported pre-tax profits up 13 per cent to £14.7 million for the year ended March 31. The results were in line with analysts’ forecasts, though investors sent the shares down nearly six per cent, closing at 319p.

Iomart, which grew revenue by 17 per cent to £89.6m, said its performance was driven by organic growth and the impact made by the £700,000 “bolt-on” acquisition of Cristie Data. It continues to run the rule over further deals.

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And chief executive Angus MacSween declared there is “still a long runway of opportunity”for the company to aim for in the cloud services market, stating that recent high-profile cyber attacks such as the assault on NHS systems show that “on premise infrastructure” is more difficult to keep secure than the cloud.

Mr MacSween, whose customers are broadly in “SME to mid-corporate” space, said the key benefit to organisations in using a cloud hosting specialist such as Iomart is the assurance that a “long tick box” of security criteria can be met. That means clients can access such services without having to make huge investments in technology, such as firewalls, themselves.

Mr MacSween said: “Security is not one single tool or service – it’s a long tick box list of best practice and tools. Some of these NHS Trusts [hit by the recent cyber attack] didn’t have simple, basic anti-virus software deployed.

“If people are looking to professionalise and secure stuff, they are inevitably going to end up in data centres that just by their very nature are more secure than an on premise solution is going to be.

“On premise solutions can be secure, but you have to put a lot of resource, time and effort into that individual on premise. What we are doing is aggregating all that security.”

Mr MacSween said Iomart continues to assess acquisition targets, having already completed a €7.9 million deal to acquire Dediserve since year-end. However, while there is no shortage of targets, Mr MacSween said the “quality varies”, noting that Iomart looks closely at only one in ten opportunities which come its way. “We still have fairly disciplined criteria around acquisitions,” he said. “We’re looking for recurring revenues and sticky customers.”

But he added: “We still see good earnings accretion with these small bolt-on opportunities. There is no reason for us to stop doing them.”

Although Iomart has a business in the US, and opportunities for deals abroad have come up, the focus of the company continues to be on the UK. The company has yet to find itself the subject of a takeover approach.

Mr MacSween said: “It is a little bid odd that we haven’t, but we genuinely haven’t had [an approach].”

With cash generation rising 22 per cent £37.8 million, bosses hiked the final dividend by 90 per cent to 6p per share.

Mr MacSween, who said the fragmentation of the cloud computing market offers scope for Iomart to expand, added: “We’re in a market space where there is a long-term opportunity. It is a big opportunity, it will pan out over a number of years and we will keep plugging away delivering the numbers.

“We generate a lot of cash now, so will continue to use that to make acquisitions. We have significantly increased our dividend as well, on the back of that cash generation.”

Meanwhile, Iomart announced that former Scottish Enterprise chief executive Crawford Beveridge has decided to not stand for re-election as a non-executive director at its forthcoming annual meeting, after six years on the board. Sarah Haran, who has been a non-executive director since Iomart floated on the stock market in 2000, will step down at the end of this year.