Gamma Communications Backs Epiris Takeover Amid Financial Growth
Gamma Communications reported strong financials for its first half of 2026. The company's revenue rose by 4% to £330m, while gross profit also increased by 4%. However, the margin was flat at 54%, due in part to pressure on UK SME and Enterprise margins amid a challenging domestic macroeconomic backdrop.
Growth was driven by a 30% jump in German SME gross profit and improved Service Provider performance. The group maintained a high 90% recurring revenue base, healthy 30% return on capital employed (ROCE), and adjusted cash conversion of 97%. Gamma also expanded its AI-enabled capabilities and rolled out Cisco's Webex for Gamma across all its core markets.
The company's strong financial performance was enough to convince the board to recommend an all-cash takeover by Epiris. This move prompted the suspension of dividends and buybacks, offering investors a near-term liquidity event instead of the standalone growth plan. The decision reflects the board's view that execution risks and market conditions could limit the company's ability to achieve comparable value independently.