Tialis Essential IT plc

("Tialis", the "Group" or the "Company")

9 September 2025

Unaudited Interim Results for the six months ended 30 June 2025

Tialis Essential IT plc, the mid-market IT managed services provider, today announces its unaudited results for the six months ended 30 June 2025.

Highlights

Revenue of £8.8 million (H1 2024: £10.7 million).

Gross profit of £2.6 million (H1 2024: £3.0 million).

Adjusted EBITDA* profit of £1.0 million (H1 2024: £0.9 million).

Repayment of the bank borrowings of £0.5 million (H1 2024: £nil)

Acquisitions of investments in AI Auxesis Limited, CloudCoCo Group Plc and Digital Petcare Direct Limited

* Adjusted EBITDA is defined as earnings before interest, tax, depreciation, amortisation, impairment charge, non-underlying items, loss on disposal of fixed assets and share-based payment

New business wins for 2025 are in line with the budget with significant contract wins due to be signed in H2 2025. We are maintaining a strong current sales pipeline of £8m annual value while continuing to grow our partner base with the addition of a large global system integrator in Q2 2025.

Post period end and as previously announced, Tialis was awarded a significant follow-on framework agreement from a long-standing and valued customer. The expanded agreement, valued at approximately £50 million, builds on the Company's previous work with the long-standing customer and will run over 5 years. Under the new framework, Tialis will deliver Lifecycle Services, Tech Bars, End User Support and Field Engineering supporting the long-standing customer's business. This follow-on award reflects the strength and depth of the Company's relationship with the long-standing customer and demonstrates the high level of customer satisfaction with the delivery record of Tialis. It will further enhance the Group's order book and revenue visibility for the next financial year.

Tialis was awarded a material new contract with one of the UK Government's principal departments overseeing environmental policy, agriculture, and rural community development, as previously announced. We commenced delivery of this contract on 1 September 2025. The contract, with a total value of approximately £15 million, will run over 5 years and involves the delivery of Lifecycle Services, Tech Bars, End User Support and Field Engineering, supporting this large UK Government Department build the workplace of tomorrow. The award follows a competitive tender process and further strengthens the Tialis order book, increasing contracted revenue visibility for the current financial year and beyond and is expected to deliver significant additional project revenue in its lifetime. This win is consistent with the Company's stated strategy of building long-term, high-value client relationships.

Revenues in the period were lower than the prior period, primarily due to delayed customer orders in the context of a challenging financial market environment. The Board believes these conditions are cyclical and that underlying demand for the Group's services remains robust. The loss of two significant contracts which were both in-sourced by the end-customers earlier than originally anticipated with the channel partners has also impacted the revenues.

The Group enters the second half of 2025 with a strong pipeline and a sharpened focus on strategic growth areas. Management expects further progress in Lifecycle services, continued partner expansion, and a stronger H2 performance.

Leveraging on the continued success of the Allvotec acquisition in 2023, Tialis has been able to agree renewals and extensions of the existing contracts, increasing the deferred and contingent consideration settlement agreed with Daisy HoldCo Limited to £1.638 million. This will be paid in shares issued in Tialis Essential IT PLC, at an effective price of 70 pence per ordinary share. This increase of £582k (FY 2024: £971k) is shown as a fair value adjustment on the face of the Statement of Comprehensive Income.

Acquisitions and Investments

As announced in the final results for the year ended 31 December 2024, Tialis has undertaken or is planning to undertake several new deals to expand its activities and to deliver growth through acquisition with synergistic targets to deepen its service offerings. The opportunity has now arisen to consolidate several investments into Tialis, to accrete shareholder value today and for the future. This will create the ability to manage a pool of permanent capital and assets, leverage the cashflow from those into dividends and create further capital growth.

AI Auxesis

In April 2025, the creation of the Subsidiary, AI Auxesis Limited required an upfront investment of £250,000 that has been used to fund its first consulting project which has started generating revenue. This investment was 50% funded by the Company and the remaining 50% funded by direct contributions of £62,500 made into the Subsidiary by both Ian Smith, Executive Director of the Company, and Andy Mills, in exchange for 25% of the shares each in the Subsidiary. As non-corporate shareholders, both Ian and Andy are entitled to a 10% per shareholder uncapped profit share on any capital gain in the underlying investment in the Subsidiary (the "Profit Share"). The Company contributed £125,000 to the Subsidiary. In order to meet this contribution to the Subsidiary, the Company conducted a direct subscription in the Company's ordinary shares at 60 pence per share, being the mid-market closing price on 8 April 2025 (the "Subscription Shares"). This was then passed on to the Subsidiary. In total the Company issued 208,333 Subscription Shares for cash for a total of approximately £125,000 (the "Subscription"). The subscribers to this fundraise were Ian and Andy in equal proportion to each other at 50% each in return for their respective 25% holdings in the Subsidiary. 

AI Auxesis is pleased to report a strong start to its partnership with QPC, culminating in the signing of a global partnership agreement with Genesys, a $2.1B-per-quarter, US-headquartered leader in contact centre solutions, serving over 8,000 enterprise customers since 1990.

In parallel, QPC has entered into a new strategic alliance with IPI, a specialist in Contact Centre, Cloud, and Connectivity services, further strengthening the international partner ecosystem. QPC also has further significant new-logo wins, including: A major telecommunications group in the Middle East, two international banking institutions, and one of the world's most prestigious luxury automotive manufacturers.

Commenting on QPC's momentum, Chief Revenue Officer Andy Mills stated: "Momentum continues to build rapidly. Our strategic focus on delivering the most granular level of CX data to power AI solutions continues to drive ARR, underpinned by strong enterprise pipeline growth across both global partners and direct customers.  We're extremely pleased with the momentum and the calibre of customers engaging with our platform."

These developments mark a critical inflection point in AI Auxesis' commercial trajectory and underline the growing market demand for our AI-driven solutions.

Digital Petcare UK Limited

In June 2025, Tialis acquired a loan agreement from MXC Capital Guernsey Limited ("MXC") between MXC and Digital Petcare UK Limited ("Digital Petcare"). The loan has an outstanding value of £1.485m and carries an interest rate of 12%. The loan was placed into a newly created subsidiary of Tialis called Tialis Essential IT Debt Limited.

Since the acquisition of the Digital Petcare loan, Tialis has completed a debt refinancing and decided to back Susie Samuel, founder and CEO of Digital Petcare, with a conversion of debt to equity alongside further investments from shareholders and outside investors. The refinancing was structured as follows:

• £500k has been converted into a 14.14% equity holding in Digital Petcare

• £700k has been refinanced into a new loan over 24 months at the same interest rate of 12%

• £285k of the loan has been repaid

CloudCoCo Group PLC

Additionally in June 2025, Tialis also acquired MXC's outstanding equity position, of approximately 10.6%, in CloudCoCo Group PLC ("CloudCoCo"). The investment was placed into a newly created subsidiary of Tialis called Tialis Essential IT Investments Limited.

Board Changes

On 8 September 2025, Tialis welcomed Rachel Horsefield and Peter Hallett to the Board as Non-Executive Directors.

Rachel was the Chief Executive Officer of THG Beauty Limited, a global retailer and brand owner operating through two leading predominantly online consumer businesses, LookFantastic and Cult Beauty. During her ten years with THG Beauty, Rachel worked with over 800 of the world's most popular brands and has a wealth of digital and beauty experience. Prior to joining THG Rachel was with Boots where she held a number of roles within ecommerce. Rachel has advised numerous listed and private companies in board positions across the digital and retail sectors.

Peter, a qualified chartered accountant, is a highly experienced plc non-executive director and chief financial officer with multi-sector expertise including technology, FMCG manufacturing and retail in national and multi-national corporates. He is the senior independent non-executive director of Altitude Group plc, an AIM listed technology company mainly US based. Peter is the co-founder, investor and strategic consultant to Merchr Limited, a private start-up technology business providing a comprehensive end to end cloud based platform providing a total outsource solution for personalised merchandise to major global brands.

Post Balance Sheet Events

On 7 July 2025, there was a share issue of 2,631,134 shares at 64p per share which was used to fund the acquisitions on 30 June 2025.

Post the interim announcement, there will be a General Meeting held to approve the new shares to be issued to Daisy HoldCo Limited of 2,339,883 shares to settle the amounts owed as mentioned above.

Outlook

The Board remains cautious given the current macroeconomic environment but is encouraged by the Group's resilient performance to date. With a focus on maintaining financial discipline and operational efficiency, the Board expects trading for the full year to remain in line with current market expectations. The Group is well placed to navigate ongoing market uncertainties while continuing to protect shareholder value.

Ian Smith said: "I am pleased to report that, in line with our stated strategy of establishing a pool of capital, we have successfully completed our first acquisition. I am delighted to welcome our new non-executive directors who will be instrumental in supporting us on this journey. This represents an exceptional opportunity for Tialis to deliver meaningful accretion in shareholder value, both today and into the future. The ability to manage a pool of permanent capital and assets, while leveraging the cashflow generated into sustainable dividends and further capital growth, was an opportunity simply too good to miss."

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