Unified comms company Pinnacle Technology saw turnover increase by 49% in 2012 with gross profit increasing 61%. However mobile revenues fell 5% in the same period.
Reporting its preliminary results to the year ending September 2012, the company, which provides mobile, fixed lines, broadband, IT, security and cloud services, attributed the fall in mobile revenues to the introduction of revenue share payments by mobile networks.
Group CEO Alan Bonner predicted mobile revenues will improve this year on the back of the company’s cross selling strategy.
He said: ‘The reduction in revenues in the year reflects the reduced commissions on offer from the major UK mobile networks, who have moved away from a fixed commission model to a commission based on share of spend. We expect mobile revenues to increase in future years as we look to cross-sell additional services in to our existing customer base.’
Pinnacle Technology’s 3,000 plus SME and corporate customers currently buy 1.4 services from Pinnacle Technology. The company said it wants to increase this to three services per customer.
Bonner said: ‘In percentage terms, our target is to achieve 60% of our customers buying more than one service from Pinnacle; achieving this goal will have a significant positive impact on our business. Currently, as a result of strategically acquiring single service companies, only 23% of our customers are buying more than one service from us. This represents a huge growth opportunity for the Company.’
The company is also on a recruitment drive to back its cross selling strategy with plans to increase its sales force. Bonner said the company was in a strong financial position to invest in its sales team, having secured £2.9m of cash following a new shares issue post last year.
He added: ‘Our financial strength will enable us to continue to invest and reposition the business, and despite the current economic conditions, we intend to make further investment in our sales teams to take advantage of the opportunities we have to increase our market share.
'Whilst the results of our cross-selling strategy may take some time to deliver, we are confident that the actions we have taken to date and the strategy we are pursuing will ensure the group continues to prosper.’
Pinnacle Technology, which changed its name from Pinnacle Telecom in March last year, is an AIM listed company.