Tip update: AdEPT Technology underrated

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Managed IT and networking services provider AdEPT Technology (LON: ADT) achieved a one-fifth increase in interim revenues to £34.3m. The prospects appear to be good as more companies move to cloud telephony, but the share price does not reflect this

Managed services revenues accounted for 87% of total revenues, which could have been higher, but delays meant that £900,000 was not recognised in the period and this should be included in the second half. Fixed line revenues are declining, although they are lower margin. There was a slightly lower overall gross margin because there were more hardware revenues in the period.

Underlying pre-tax profit was 16% higher at £3.5m and earnings per share were 30% ahead at 13.2p due to a lower tax charge. Net debt was £31.2m at the end of Septembe...

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