Gamma Communications (LSE:GAMA) reported a 4% increase in first-half 2026 revenue to £330 million, while its board has recommended an all-cash takeover offer from Epiris.
Gross profit increased 4% year-on-year, with the gross margin unchanged at 54%. The company reported adjusted cash conversion of 97% and return on capital employed of 30%, while recurring revenue represented 90% of the group total.
Gamma said its German SME operation recorded a 30% increase in gross profit, while its Service Provider business also improved. These gains were partially offset by margin pressures in the UK SME and Enterprise businesses amid challenging domestic economic conditions.
The group also reported continued cash generation and a reduction in leverage following its acquisition of Starface.
In the UK, Gamma said demand continued for cloud communications and full-fibre connectivity products. Gross profit associated with PSTN services remained stable, supported by pricing measures. The company also reported progress in the Asia-Pacific region, including additional licences and new customers.
Gamma continued the deployment of Cisco’s Webex for Gamma across its core markets during the period and expanded the use of AI-enabled capabilities within its communications offering.
Separately, Gamma’s board has recommended an all-cash acquisition by Epiris. Following the recommendation, dividend payments and share buybacks have been suspended.
The board said its assessment of the offer took into account the risks associated with executing Gamma’s standalone strategy and prevailing market conditions. The proposed transaction remains a material consideration for shareholders alongside the company’s first-half operating performance.
More about Gamma Communications
Gamma Communications is a FTSE 250-listed provider of communications technology serving small and medium-sized businesses, larger companies and public-sector organisations.
The group provides cloud communications software, calling and network connectivity through its own telecommunications infrastructure and third-party platforms. Its operations include the UK, Germany, Spain and the Netherlands, with more than 2,000 employees.
Gamma serves customers through channel partners and direct relationships. Its operations include Gamma Business for UK SMEs, Gamma Enterprise for larger organisations and a German business serving SMEs through partners and a self-service digital platform.
The company also works with technology providers including Cisco, offering communications services incorporating telephony, messaging, video and AI-enabled customer experience capabilities.
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