Newmark Security FY25: HCM turns the dial while cash stays tight
Newmark Security’s audited FY25 numbers show steady progress, powered by Human Capital Management (HCM). Revenue edged up 3% to £23.0 million, margins improved, and earnings jumped. The flip side is lower operating cash generation and a lean cash balance, so execution in FY26 really matters.
| Metric | FY25 | FY24 |
|---|---|---|
| Revenue | £23.0 million | £22.3 million |
| Gross margin | 40.7% | 38.5% |
| EBITDA (earnings before interest, tax, depreciation and amortisation) | £2.4 million | £2.2 million |
| Operating profit | £0.9 million | £0.8 million |
| Profit after tax | £0.7 million | £0.1 million |
| Basic EPS | 7.06p | 1.43p |
| Cash generated from operations | £1.8 million | £3.0 million |
| Cash at bank (year end) | £0.4 million (balance sheet: £344,000) | £1.1 million |
| Total debt incl. leases (year end) | £4.0 million | £4.9 million |
HCM is the growth engine: ARR and subscriptions accelerating
HCM, which provides time clocks, cloud software and services, is firmly in the driving seat. Revenue rose 14% to £15.4 million and now represents 67% of Group sales. Annualised recurring revenue (ARR – the annual value of in-place subscriptions) increased 24% to £3.6 million. Monthly device subscriptions grew 32% to 40,635, including the first 3,027 subscriptions on the new per-employee-per-month model designed for direct-to-end-user (D2E) routes.
The division’s margin mix is moving the right way too. Grosvenor (the People and Data Management arm housing HCM and Access Control) lifted gross margin to 42.5% from 39.7% on the back of higher software and services attachment.
Enterprise integrations and D2E strategy: Oracle, SAP, Workday
- Oracle Integrator status achieved in H2, with first D2E customers expected in FY26.
- SAP integration completed earlier than planned; pipeline now building for FY26.
- Workday certification on track by mid-FY26, with pipeline to build thereafter.
- North America partnership with Synerion signed, combining GT Clock devices with Synerion’s workforce management software to target D2E opportunities.
- Post year-end, a new five-year supply agreement was signed with Protime NV for GT Connect cloud services, clocks and OEM access control.
Why it matters: these integrations open access to large enterprise marketplaces where procurement prefers certified, pre-integrated solutions. If Newmark converts even a slice of these pipelines, ARR could see another step-up in FY26-FY27.
GT Tablet launch broadens the addressable market
In FY26, the company will launch GT Tablet – a software-only clock app for iOS and Android that links to GT Connect and GT Services. It will not replace industrial-grade hardware in high-throughput sites, but it unlocks dispersed and mobile use cases – retail, healthcare, field teams – where installing fixed clocks is impractical. One HCM partner is already committed to onboarding GT Tablet, with others in discussion.
My take: this is smart. It lowers deployment friction, increases the pool of potential endpoints and should support faster subscription growth at attractive margins.
Access Control and Safetell: mixed year, strategic reviews underway
Access Control: second-half improvement, but full-year decline
Access Control revenue fell 10% to £2.7 million, hampered by delays in the Janus C4 Ultra software partner rollout and slower migrations. The business improved in H2, but not enough to offset the weaker start. Management is refocusing sales on higher-return opportunities, accelerating development and running a strategic review of the unit.
Safetell (Physical Security): services now 56% of the division
Safetell’s total revenue slipped 15% to £4.9 million after public sector projects pushed into FY26 and retail demand softened. The bright spot is services: up 30% to £2.7 million, now 56% of divisional revenue. Door Services revenue rose 49% to £1.0 million, helped by expanded capability into roller shutters. A strategic review aims to drive improved growth and shareholder value.
Why it matters: services revenue is typically higher-margin and more predictable. If delayed projects land and the service base keeps compounding, Safetell can resume growth while improving quality of earnings.
Cash, debt and dividends: headroom exists but watch the runway
Cash from operations fell to £1.8 million (from £3.0 million) as FY24 benefited from a one-off inventory unwind. Year-end cash was light at £0.4 million (the balance sheet shows £344,000). Total debt including leases reduced to £4.0 million, with bank net debt at £2.1 million. The Group added a $2 million US revolving credit facility in February 2025 and continues to use invoice finance facilities. No dividend is proposed.
On risk management: HCM terminals are currently exempt from new US tariffs due to classification as data terminals. Stock turn improved to above the 3.5 target. Newmark also entered FX forwards hedging roughly 75% of excess USD, and it is pursuing SOC 1 and SOC 2 compliance in FY26 to strengthen enterprise credentials.
Operational colour: where growth came from
- HCM North America revenue rose 5% to £9.9 million, with strong demand for GT4 and GT4-Lite displacing a low-cost competitor.
- HCM Rest of World grew 37% to £5.5 million after a stronger H2 and an exclusive position with a major European partner.
- Grosvenor division revenue reached £18.1 million, nearly 80% of the Group total.
Outlook and FY26 catalysts to watch
- First D2E wins through Oracle in FY26; SAP integration completed and Workday certification targeted for mid-FY26.
- GT Tablet launch on iOS and Android, with the first partner already committed.
- North America push with Synerion to deliver combined solutions directly to end users by the end of FY26.
- Safetell’s deferred public-sector projects rescheduled into FY26 and continued expansion of Door Services.
- New five-year supply agreement with Protime NV underpinning HCM device and cloud revenue.
The Board guides to another year of growth, noting a good start to FY26 and building pipelines across both divisions.
Key risks and what I’m watching
- Conversion risk on D2E pipelines with Oracle, SAP and Workday – timing and scale of wins will drive ARR.
- Cash headroom – facilities exist, but low cash means tight execution and working capital discipline are essential.
- Access Control delivery – Janus C4 Ultra delays need resolution; outcome of the strategic review could reshape the unit.
- Safetell project timing – public sector schedules and retail investment cycles can still move to the right.
- Currency – partially hedged, but USD/GBP shifts can affect reported results.
My view: quality progress where it counts, with execution now the swing factor
There’s a lot to like here. HCM is scaling, ARR is compounding, and big-league integrations open larger, stickier markets. GT Tablet could be a neat accelerant for subscriptions without a heavy hardware bill. The new Protime agreement and Synerion partnership add depth and visibility.
The caution flags are familiar: slim cash, softer Access Control, and a Safetell recovery that depends on projects landing on time. That said, debt is down, margins are up, and the order pipelines look fuller into FY26. If management converts D2E opportunities at pace and keeps services attachment high, Newmark can keep nudging profitability higher and de-risk the model further.
Further reading and investor access
- Company site: www.newmarksecurity.com
- Investor webinar (today, as flagged in the RNS): Investor Meet Company registration
