Full-year results and trading updates from across the UK tech sector painted a picture of broad-based demand strength on Wednesday, even as one of the day's best performers saw its shares marked sharply lower despite beating expectations. Softcat delivered a blowout set of annual results and lifted its dividend, discoverIE upgraded its earnings outlook on accelerating order growth, and AIM-listed Corero Network Security reported a surge in bookings driven by new Tier-1 telecoms contracts.
Softcat beats guidance with bumper year of growth
Softcat (LSE:SCT) delivered a set of annual results that the company itself said significantly beat the expectations it had set at the start of the financial year, underscoring the resilience of its position supplying hardware, software and managed services to corporate and public sector customers across the UK and Ireland. Despite the strength of the numbers, shares in the IT infrastructure reseller fell 10.395% to 1724.0p, a reaction that sits at odds with the scale of the growth reported for the year to 31 July.
Gross invoiced income rose 30.5% to £4.72 billion, up from £3.62 billion a year earlier, while gross profit climbed 24.7% to £616.3 million and underlying operating profit rose 19.4% to £215.1 million. Statutory operating profit increased 13.6% to £196.4 million after absorbing £18.7 million of non-underlying costs tied to investment in a new sales system. Underlying basic earnings per share rose 19.7% to 83.2p. The customer base grew 3.4% to 10,500 while gross profit per customer jumped 20.6% to £58,500, reflecting deeper spend from existing accounts. The board lifted the total ordinary dividend 7.5% to 31.5p and the company returned £137.5 million to shareholders over the year, including its first-ever share buyback of £45 million completed in February.
"Growth in gross profit and underlying operating profit came in significantly ahead of our expectations at the start of the year, reflecting the strength of our culture, the quality of our customer relationships and the benefits of the sustained investment we have made over many years," said Graham Charlton, Chief Executive.
The breadth of the growth, strong across corporate, public sector, small and medium business and enterprise customers alike, reinforces Softcat's standing as one of the more consistent compounders in UK tech distribution, with cash conversion still above 93% and net cash rising to £199.9 million. The share price reaction suggests the market had already priced in much of this upgrade cycle, or is now questioning whether growth of this magnitude is repeatable; either way, the scale of the beat raises the bar for what the market now expects Softcat to deliver next year.
discoverIE lifts earnings outlook on strong first-half order growth
discoverIE Group (LSE:DSCV) told investors that full-year adjusted earnings are now tracking ahead of the board's expectations, with a trading update covering the first half of the financial year to 31 March 2027 pointing to accelerating momentum. Shares in the designer and manufacturer of customised electronics slipped 1.02% to 871.0p despite the upgrade, organic sales growth of 8% over the half, picking up from 6% in the first quarter to 10% in the second.
The acceleration was led by the Magnetics & Controls division, where organic growth of 13% was driven by industrial electrification, renewable energy and security demand, while Sensing & Connectivity grew just 1% organically as longer supply lead times in some segments and a tougher comparator weighed on the result. Including recent acquisitions, total group sales rose 13% at constant currency and 14% on a reported basis, while orders climbed 22% organically, with Magnetics & Controls orders up 25%.
The divergence between discoverIE's two divisions is the detail worth watching: Magnetics & Controls is now doing the heavy lifting for group growth, giving the company exposure to structural electrification and renewables themes, while Sensing & Connectivity's sluggishness signals that parts of its end markets remain in a longer destocking or lead-time normalisation phase. An earnings upgrade delivered against that backdrop suggests management has confidence the stronger division's momentum can keep outrunning the weaker one.
Corero Network Security sees orders jump with Tier-1 wins
Corero Network Security (AIM:CNS), the DDoS protection specialist, reported order intake up 50% to $11.1 million in the third quarter, from $7.4 million a year earlier, with year-to-date orders up 28% to $25.4 million. Shares eased 0.398% to 12.5p, a muted reaction set against order growth the company attributed to channel expansion across North America, Western Europe, the Middle East, Southeast Asia, Central America and Oceania, alongside new Tier-1 telecoms customers in the US and UK.
The quarter's standout win was a $3.4 million, five-year managed services contract signed in September with a UK Tier-1 fixed and mobile telecoms provider, delivered through Corero's on-premises technology and UK-based security operations centre. The customer is already subject to the Telecommunications Security Act, pointing to regulation as a direct driver of new business alongside infrastructure growth across its target markets.
"This was another strong quarter for Corero, with bookings growth noticeably enhanced by the contribution of our renewed channel partner program," said Carl Herberger, Chief Executive. Landing Tier-1 telecoms accounts under regulatory pressure to harden network defences gives Corero a reference customer base that should support further channel-led wins as compliance deadlines bite across the sector.
