Cerillion software demand will go on increasing (LON:CER)

Cerillion plc (LON:CER) Chief Executive Officer Louis Hall caught up with DirectorsTalk for an exclusive interview to discuss record revenue & adjusted EBITDA, continued investment in the business, inflationary pressures and market demand.

Q1: Louis, Cerillion continue to set new records for both revenue and adjusted EBITDA, what’s driven this tremendous half year performance?

A1: I think we’re seeing the flow through of backlog of new projects that we’ve closed, new customer wins, and as we deploy those solutions, we’re seeing significant revenues coming from those projects. Also very strong demand from existing customers to do more work and provide further extensions to their solutions.

All this being driven by a huge amount of investment by telecoms businesses in extended fibre rollout, but also more 5G broadband capacity so those are the main drivers.

Q2: One of the hallmark of success seems to be your continued investments into the business, can you just tell us a bit more about that?

A2: It’s absolutely fundamental that we keep on investing in the products because unless we have the latest greatest state of the art features, functionality, architecture etc.  then customers will not stay with us in the long term.

So, every year we produce two new major versions of the product and release one in March and one in October, and that’s a really important part of our strategy going forward.

We’re also investing in new offices, we recently opened a new office in Bulgaria and we’re looking at other locations where we can add to our skill base because we see that’s a very important feature over the next few years as demand probably will only increase for technology staff.

Q3: What’s the company doing about inflationary pressures?

A3: So, that plays into the previous point really that our main bases are historically UK and India, but we’ve recently opened up a new base in Bulgaria and we’re building services and resources rapidly in that base. We’re looking at a couple of other locations in different parts of the world where we believe we’ll get access to good skills at realistic competitive rates.

So, that’s a key feature of what we’re doing to address the inflationary pressure we’re seeing in our traditional bases.

Q4: Finally, how do you see the market demand of Cerillion’s products evolving?

A4: I think that the demand will just go on increasing in that we have a product solution that is ideally suited to a whole range of telcos who want to avoid complex, customised, bespoke solutions that take years and cost hundreds of millions. We’re have a solution that we can deploy in months that costs significantly less than that so I think that demand will go on increasing.

In a macro world, we are seeing just never ending demand for more and more broadband and that is driving investment both in mobile and in fixed that trickles down into of the ancillary systems that we provide, and investment in those systems.

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