Cerillion Reports Strong FY25 Earnings Growth and Record Back-Order Book

Cerillion FY25 results: record margins, beefy cash and a bigger backlog

Cerillion has delivered another tidy set of numbers for the year to 30 September 2025. Revenue nudged up 4% to £45.4m, but profits moved much faster thanks to strong delivery and pricing, with adjusted EBITDA up 11% to £23.1m and a record 50.9% margin. Cash keeps piling up – net cash rose 15% to £34.4m – and the order book and sales pipeline both hit new highs. The dividend is up 17% to 15.4p, signalling confidence.

The headline: growth this year was steady rather than spectacular on the top line, but future revenue is lining up nicely. A record £47.6m of new orders and a £56.9m back-order book give solid visibility into FY26.

Key figures investors should know

Metric	FY25	FY24	Change
Revenue	£45.4m	£43.8m	+4%
Recurring revenue (c.35% of total)	£15.9m	£15.5m	+3%
Adjusted EBITDA	£23.1m	£20.7m	+11%
Adjusted EBITDA margin	50.9%	47.4%	+350bps
Adjusted profit before tax	£21.8m	£19.8m	+10%
Statutory profit before tax	£21.7m	£19.7m	+10%
Adjusted basic EPS	56.5p	52.2p	+8%
Total dividend per share	15.4p	13.2p	+17%
Net cash	£34.4m	£29.9m	+15%
New orders	£47.6m	£38.1m	+25% (record)
Back-order book	£56.9m	£46.9m	+21% (record)
Sales pipeline (unweighted)	£275m	£262m	+5% (record)
Gross margin	81.5%	80.5%	+100bps

Jargon watch: “adjusted EBITDA” adds back non-cash items such as depreciation and share-based payments; the “back-order book” is contracted work not yet recognised as revenue; the “pipeline” is the total, unweighted value of qualified sales prospects.

Revenue mix: services stepped up, software steady

Services revenue rose 7% to £19.0m, reflecting strong implementation activity and account development. Software revenue was broadly flat at £24.4m, with higher Cerillion licences offset by lower third-party licence sales. Other revenue was £1.9m, up 19%.

Recurring revenue was £15.9m, around 35% of the total, and grew 3%. That mix is decent, but there’s room to nudge the recurring slice higher over time. Gross margin improved to 81.5% on higher day rates and a favourable licence mix – classic operating leverage for a software-led model.

Bookings, backlog and pipeline: the FY26 underpins

The order intake is the star. Cerillion signed a record £47.6m of new orders, including:

• £25.3m of agreements with an existing European customer to onboard a newly acquired tier-1 mobile base and extend support, managed services and Evergreen.
• $11.4m (£8.5m) over five years with Ucom in Armenia.

The back-order book stands at £56.9m, made up of £47.4m of contracted-but-not-yet-recognised sales plus £9.5m of annualised support and maintenance. About 33% of that £47.4m is expected to drop into revenue within 12 months, underpinning FY26. The unweighted pipeline hit a record £275m, showing plenty of shots on goal.

Operational progress: deliveries landed and AI product push

Two major implementations went live: Virgin Media Ireland’s mobile customer base and Paratus in Southern Africa, the latter integrated with a new Nokia 5G mobile network. Another Virgin Media Ireland phase – migrating the fixed-wire base – is slated for 2026.

R&D effort jumped 34% with a clear focus on AI. The October 2025 release (Cerillion 25.2) introduced a Model Context Protocol server and a suite of “AI Agents”, led by the Billing Agent, to bring conversational intelligence to billing, customer service and operations. The platform also gained a new Service Catalogue, refreshed Interconnect Manager and composable mobile app enhancements. Cerillion achieved two TM Forum Open Digital Architecture Component Certifications and featured in multiple Gartner reports and an IDC MarketScape as a “Major Player”.

Cash generation, dividends and balance sheet

Cash generation remained robust. Net cash from operating activities was £13.2m (FY24: £11.2m) after tax, and the Group closed the year with £34.4m of net cash and no debt. Capitalised development rose to £1.8m (amortisation £1.1m), reflecting the step-up in R&D. A £0.3m R&D credit was recognised as other income under the new merged RDEC scheme.

The Board proposed a 10.6p final dividend, taking the full-year payout to 15.4p, up 17%. With a debt-free balance sheet, strong cash flows and a growing backlog, the dividend looks well supported.

Where the cracks might show

• Top-line pace: revenue growth was 4%. With orders and backlog at records, FY26 should accelerate, but delivery and milestone timing will dictate how much lands within the year.
• Customer concentration: one European customer delivered £13.1m of revenue (>10% of Group). It’s a common feature in BSS/OSS, but still worth monitoring.
• Working capital: contract assets (accrued income) increased to £25.0m from £18.4m, reflecting project timing. It’s typical for long implementations, but higher accrued balances can stretch cash if milestones slip. That said, cash generation remained strong.
• Geography mix: UK & Europe revenue rose to £34.9m, while MEA and the Americas declined year-on-year. The pipeline is “substantial” across regions, but delivery looks more Europe-weighted for now.
• Tax inquiry: there’s an ongoing discussion with the India tax authority for 2021-2022. No provision is booked; outcome not disclosed.

Why this update matters for shareholders

Cerillion is showing the characteristics of a high-quality software business: very high gross margins, rising operating margins, strong cash, disciplined costs and healthy dividends. The record order intake and backlog provide rare visibility in a lumpy project world. The R&D step-up, especially around AI Agents and composable modules, strengthens the competitive moat and helps justify those premium margins.

On the flip side, growth still depends on landing and delivering chunky projects for large operators, so revenue can be bumpy. Customer concentration and higher contract assets are the two operational watchpoints. But with no debt, £34.4m of cash, and 33% of the contracted backlog due to be recognised within 12 months, the runway into FY26 looks well set.

My take: steady now, set up for more later

FY25 was about execution and margin expansion; FY26 should be about converting the record backlog and pipeline into a faster top line. If Cerillion delivers the big European mobile onboarding and progresses Ucom on schedule, reported growth should lift. The dividend hike and robust balance sheet back up management’s confident tone.

Overall, a positive update: quality metrics at new highs, bookings momentum intact, and product innovation pointing the right way. Keep an eye on delivery timing and working capital, but the setup into the new year is strong.