TPXimpact has reported a substantial increase in earnings following a three-year restructuring programme, with first-half revenue rising 60% and the digital transformation company repaying all its outstanding bank borrowings.
The AIM-listed business generated revenue of £57.9m during the six months to 30 September 2026, compared with £36.2m a year earlier, supported by stronger demand from public-sector customers and a significant increase in new contract wins.
Adjusted earnings before interest, tax, depreciation, and amortisation (EBITDA) rose 152% to £8m, up from £3.2m during the equivalent period last year.
The adjusted EBITDA margin increased from 8.8% to 13.9%, reflecting higher revenue and continued control of central operating costs.
On a statutory basis, TPXimpact recorded an operating profit of £3.5m, reversing a £1.1m loss. Pre-tax profit reached £3.2m, compared with a loss of £1.7m a year earlier.
The improved trading performance was accompanied by stronger cash generation. Operating cash flow increased from £2.5m to £6.2m, allowing the company to repay its remaining borrowings during the period.
TPXimpact ended September with net cash of £1m, excluding lease liabilities, compared with net debt of £4.2m at the end of March.
Chief executive Björn Conway attributed the improvement to the company’s streamlined operating model, stronger customer relationships, and investment in account management and business development following completion of its transformation programme.
Public-sector contracts drive growth —
The company secured £86m in new business during the first half, compared with £31m a year earlier.
Major awards included £25m of work with HM Prison and Probation Service, £19m with HM Land Registry, £16m with the Ministry of Justice, and £5m with the British Library.
Smaller contracts and extensions accounted for a further £21m.
These awards represent new business secured during the period, rather than revenue recognised in full within the first-half accounts. Their contribution will depend on the delivery schedules and terms of the individual agreements.
Public-sector customers accounted for approximately 94% of TPXimpact’s revenue, with central government organisations representing around 70%.
The figures demonstrate the company’s substantial exposure to public-sector spending decisions, particularly investment in digital services, technology modernisation, and improvements to government operations.
Established customer relationships provided an important source of revenue. Approximately 70% of sales came from organisations that had worked with TPXimpact for at least three years, while another 15% came from relationships lasting between two and three years.
As its order book expanded, TPXimpact increased staffing to support contract delivery.
Total headcount, including associates, rose 15% to 806 compared with the end of March. Permanent employee numbers increased from 415 to 508 over the same period.
Employee retention improved from 83% to 86%.
The additional activity lifted gross profit 55% to £17.3m, although the gross margin declined slightly from 31% to 30%.
Management attributed the margin movement partly to greater use of contractors while mobilising resources for newly secured work.
Despite that reduction, the company’s higher revenue and management of central costs produced a substantial improvement in operating profitability.
Stronger balance sheet supports investment —
The results follow completion of TPXimpact’s three-year transformation programme, during which management reorganised operations and reduced costs to establish a more efficient business structure.
The company has subsequently increased investment in customer management, marketing, and commercial development, supporting its ability to compete for larger contracts.
Demand for artificial intelligence and digital transformation services also features in its customer pipeline, particularly among organisations seeking to modernise established operational processes.
TPXimpact retains an £11m revolving credit facility, together with additional borrowing arrangements, providing access to funding even though its outstanding bank debt was repaid during the half-year.
The board expects to review its approach to capital allocation as the company’s cash position develops.
Management has reaffirmed its guidance for the financial year ending 31 March 2027, expecting revenue of at least £105m and adjusted EBITDA of at least £14m.
Those expectations were upgraded in October and remain unchanged following the interim results.
The company enters the second half with a larger contract portfolio, improved profitability, and no outstanding bank borrowings, while remaining heavily dependent on public-sector customers for its revenue.
