Gamma announces positive results for 2021

Gamma announces positive results for 2021 with increase in revenues and cash generation driven by new product launches and a full year of trading in Europe

Gamma Communications plc (“Gamma” or “the Group”), a leading provider of Unified Communications as a Service (“UCaaS”) into the UK and European business markets, is pleased to announce its results for the year ended 31 December 2021.


Year ended 31 December 
20212020Change (%)
Gross profit£228.5m£200.8m+14%
Gross margin51%51% 
Profit from operations**£68.3m£75.7m-10%
Adjusted EBITDA*£95.4m£79.0m+21%
Adjusted PBT*£77.2m£61.7m+25%
EPS (Fully Diluted, “FD”)**55.2p66.6p-17%
Adjusted EPS (FD)64.0p51.3p+25%
Total dividend per share13.2p11.7p+13%
Cash generated by operations£89.8m£70.3m+28%
Cash generated by operations / adjusted EBITDA94%89% 
Cash and cash equivalents (gross cash)£49.5m£48.0m+3%


*All adjusted measures set out above and throughout this document which are described as “adjusted” represent Alternative Performance Measures (“APMs”) and are separately presented within the statement of profit or loss or reconciled in the Financial Review section or segment note and are applied consistently. Where reference is made to adjusted EPS this is stated on a fully diluted basis. Definitions of APMs are included in the Financial Review. Our policy on the use of APMs is included in note 2.

** In 2020 Profit from Operations, statutory EPS and the statutory PBT figures included the profit on disposal of The Loop (£19.5m); therefore the fall in statutory PBT is not a reflection of a change in trading patterns.

Key Highlights

The Group had a strong financial performance with good growth across all key product categories during the year.

Financial highlights 

All business units continued to perform well:

  • Revenue grew by 14% from £393.8m to £447.7m. The UK Revenue growth in the period was 9% (from £345.3m to £375.0m). The European Business grew revenues from £48.5m to £72.7m which includes a full year of acquisitions made in 2020 in Spain and Germany.
  • Recurring Revenue (being Revenue which is recognised “over time” as per note 3, grew from £359.3m to £400.1m (being 89% of total Revenue; 2020 – 91%). The percentage reduction is due to the acquisition of HFO in Germany. Its Epsilon subsidiary offers mobile connections on which the commissions earned are non-recurring.
  • Gross Margin percentage is unchanged across both years at 51% with an increase in margins in the UK businesses being offset by the decreased margin in Europe as a result of the prior year acquisition of the Epsilon subsidiary which operates in a sector which has lower margins.
  • UK Indirect Business continued to grow strongly with a focus on the existing partner base. Gross profit increased from £132.2m in 2020 to £143.2m in 2021 (+8%).
  • UK Direct Business continued to deliver positive growth, with Gross Profit increasing 14% from £46.3m in 2020 to £52.6m in 2021. The 2021 figures include the results of Mission Labs since its acquisition on 3 March 2021 and reflects the exclusion of revenues from The Loop subsequent to its sale on 31 December 2020.
  • The European Business saw Gross Profit increase 47% from £22.3m in 2020 to £32.7m in 2021, primarily as a result of the inclusion of twelve full months of trading results for acquisitions which happened in 2020. The level of Gross Profit in H2 2021 (£16.6m) was higher than that earned in the first half of 2021 (£16.1m).

Product highlights 

There continues to be strong growth across the major product groups in the United Kingdom:

  • The number of installed SIP Trunks as at 31 December 2021 increased by 20.7% to 1,430,000 from 1,185,000 at 31 December 2020; these figures include sales of the MS Teams Direct Routing product and seats on Exactive’s Cloud UCX platform.
  • Overall Cloud seats increased by 15.0% to 743,000 as at 31 December 2021 from 646,000 at 31 December 2020 (this includes Horizon, Collaborate and our Cloud Contact Centre). Within this, the number of Horizon (Cloud PBX) users increased by 12.5% to 676,000 from 601,000 and the number of Horizon users taking the additional Collaborate service increased by 37.0% from 46,000 to 63,000.

The number of Cloud PBX seats in our European business increased by 12.6% to 128,000 at 31 December 2021 from 114,000 at 31 December 2020.


On 3 March 2021 we acquired Mission Labs. The initial consideration (net of cash acquired) was £40.8m with up to an additional £6.0m contingent deferred consideration payable over the next three years assuming certain development milestones are met.
We had been partnering with Mission Labs over the previous 18 months on various projects such as PhoneLine+. The addition of Mission Labs has enabled us to work with the team to continue to develop the existing Mission Labs products (Circle Loop and Smart Agent) as well as gaining a development capability which has already started working on our next generation of UCaaS products. The additional development capability has proved valuable in an environment where employment of software developers has become more competitive.


The Board is positive about the outlook for the Group in 2022 and beyond. We believe that more and more businesses of all sizes are seeing the advantages of cloud communications and as a result of a rapid shift to a more flexible and digitally enabled working environment, we expect to see continuous demand across all markets, and ongoing growth in UCaaS product sales.

Andrew Taylor, Chief Executive Officer, commented,

“Our overall business performance in 2021 has been strong in an exciting growth market, and we have delivered an excellent set of financial results. Throughout the year, and with a focus on delivering long-term growth, we have further developed and strengthened our technology, product, and people capabilities across Gamma, with our software development capabilities being significantly augmented with our acquisition of Mission Labs in March 2021.

“As part of a structured growth strategy and group operating model, we have made very good progress with the integration of all our acquisitions and have significantly broadened and strengthened our market capabilities through the development and launch of a set of new UCaaS products and services. This is designed to enable and accelerate our long-term growth objectives across the UK and Europe, while providing a technology platform capability for the future.

“Despite the economic and business market impact of the COVID-19 pandemic, our performance was very robust throughout the year, driven by excellent partner and end-customer engagement levels, and a continued acceleration to cloud based products and services. We delivered strong unit growth across all key products. Our newly launched bolt-on products and services have achieved attachment rates in line with our expectations.

“As ever, we have continued to invest and strengthen both our direct and indirect channel propositions across all markets, with a focus on positively enabling our partners and our end-customers to be competitive and highly successful in their respective markets.”

View Gamma Annual Report and Accounts 2021 – PDF