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Redcentric eyes £20m per year from public sector deal
(WebFG News) - IT managed services provider Redcentric was confirmed on Thursday as the preferred supplier for the Health and Social Care Network and Public Services Network services in the Yorkshire and Humber region.
The arrangement, which has the potential to add between £15m and £20m of incremental revenue per year, will reduce costs and enable more efficient and integrated delivery of services across the region by connecting local public sector organisations, such as local authorities, emergency services, transport and health sectors.
3,000 websites from a total of 65 different organisations can be connected through Redcentric, improving organisation and infrastructure.
The company expects that between £1m and £3m of revenue from the framework agreement will be delivered in the current financial year, with that amount increasing over the course of the frameworks lifespan.
Chris Jagusz, chief executive of Redcentric, said "We are proud to have been awarded this framework, it is a great example of a flexible and collaborative partnership between public and private sectors. It also demonstrates Redcentric's credentials as a trusted and reliable technology partner."
As of 0929 BST, Redcentric's shares were up 3.37% at 92.00p.
House broker Numis said the framework agreement with "looks to us like a significant turning point for the group" and expect it to move recurring revenues "robustly back on to a growth track, and also to provide a significant boost to sentiment".
Analysts upgraded their EPS estimates for the 2020 financial year by 10% to 6.1p and, "given the operational leverage in the business", set out new 2021 EPS forecasts of 7.4p up from the 4.5p forecast for the current full year and 5p for 2019.