Alfa Financial Software confident on FY outlook as H1 recurring revenues rise

(Sharecast News) - Asset finance software Alfa Financial Software said on Thursday that it remained on track to meet full-year expectations after reporting strong growth in recurring revenues and its contract book during the first half. Revenue for the six months to 30 June rose 4% year-on-year to £65.1m, or 5% at constant currencies, as subscription revenues increased 14% to £24.1m and delivery revenues grew 5% to £32.4m, offsetting a 17% revenue decline in the smaller software engineering division to £8.6m.

Annual recurring revenue increased 17% to £48.5m, while total contract value also rose 17% to £247.0m following two pipeline conversions. Subscription TCV was up 22%, with Alfa saying its late-stage pipeline contained nine prospects.

Operating profit declined 15% to £18.4m, reflecting £1.6m of severance costs and foreign-exchange hedges. Excluding these, operating profit rose 2% to £20.3m. Pre-tax profit fell 15% to £18.2m.

Chief executive Andrew Denton said: "After a very strong FY25 we continued to make excellent progress in growing high-quality subscription revenues."

Alfa said some delays in moving projects to contract had slightly reduced its delivery revenue expectations for 2026, but this was expected to be offset by improved software engineering revenues. Overall, it continued to expect to meet full-year forecasts.

At 0934 BST, shares in Alfa were up 1.7% at 165.2p.

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