Azzurri Communications CEO Vim Vithaldas is in an upbeat mood as he discusses the company’s prospects for 2013.
‘Six months into our current financial year, we have hit all our financial targets so far and we are ahead on our year-on-year performance to date by about 1% or 2%… It is also the first time in a long time we have hit the numbers for four consecutive quarters, so we have got real momentum now,’ says Vithaldas (pictured).
Vithaldas has good reasons to be cheerful as he argues that Azzurri is emerging from troubled times. Just over a year ago, the company was struggling under mounting debts accrued during an aggressive acquisition drive which saw it acquire 11 companies in four years. As its debts rose to over £115m, owner Silverfleet Capital exited the business after agreeing a debt-for-equity swap with a syndicate of seven banks. The deal was followed by a management restructuring which saw Vithaldas brought on board in December 2011 to head up a new management team.
The company is not out of the woods yet but Vithaldas stresses it has been moving in the right direction. He points to Azzurri’s recently published accounts for the 12 months to June 2012 as evidence. He says that, despite revenues declining year-on-year from £129m to £125m with EBITDA down from £11.9m to £9m in the same period, Azzurri is nevertheless on an upward trajectory.
‘Although there was a 3% year-on-year decline in revenues, that compares to an 8% to 9% decline the previous year, so that is not a bad year.’ He adds: ‘Once the refinancing was completed and new management team was in place, performance in the second half of the year was terrific, delivering over 65% of the year’s profits in that period.’
Much of that growth has come from a welter of contract wins and the extension of a number of contracts with existing customers. Vithaldas ticks off some of the latest wins as evidence of Azzurri’s resurgence. ‘We have had some terrific wins in the past year – Dixons, Reed Recruitment, Savills, JD Sports, with a number of deals in the pipeline – all blue chip companies, so we are picking up some decent wins.’
The strategy is backed by a sales team that has been restructured into two divisions, with an account management team to look after existing business and a business development team focused on selling a wider range of services to existing clients.
However, Vithaldas is keen to emphasise that Azzurri’s strategy for growth is not all about winning new business. The company is keen to cross-sell more products into its base of 4,000-plus customers, targeting its top echelon of around 600-700
high value customers via dedicated account managers.
Vithaldas is confident the strategy is working. ‘A major focus this year has been to sell more of our services to our existing clients with everyone united in that across the company. We are expecting better results this year and so far they are significantly better results.’
Nor are there any plans to return to the acquisition trail. Vithaldas says that the company is focusing on harnessing the talent within the company to help drive it forward, rather than building through takeovers. Organic growth is currently running at about 8% per annum.
‘It is all about organic growth. Our product development team under Rufus [Grig, chief technology officer] is an exceptionally talented team and our propositions are continuing to evolve, so we do not need to make acquisitions.’
Looking to the future Vithaldas says: ‘2013 will be more of the same. It will see us evolving our propositions more closely to what the market wants, continuing to hit all our financial targets and winning new clients.’
He declines to predict how much revenue and profits will grow in this financial year but says: ‘I am quietly confident. I am expecting marginal growth on the revenue line and decent growth on the profit line on a year-on-year basis, but what I am really interested in doing is delivering sustainable and consistent profit growth.’
Author: Carol Millett