Intercede Group PLC (LON:IGP) shares gained after the UK software firm returned to profitability a year earlier than expected on the back of cost cuts and higher revenues.
The company, which supplies identity and credential management software, swung to a net profit of £500,000 in the year to the end of March 2019 from a loss of £3.8mln last year.
READ: Intercede posts narrower half-year operating loss on cost-cutting efforts
The results were boosted by a 26% drop in operating expenses to £10.1mln following cost cuts, which included the disposal of one of its UK properties.
Revenue increased 10% to £10.1mln, supported by contract wins and upselling to existing customers.
Major contract wins included awards from a US Federal agency tasked with intelligence and security services and an intergovernmental alliance organisation.
The company ended the year with a net cash position of £3.2mln, up from £2.3mln in 2018.
"Intercede has undergone a challenging period resulting in the board making transformational changes to ensure a return to revenue growth and profitability,” said chairman Chuck Pol.
“I am pleased to announce that the Group is reporting performance that is ahead of market expectations by returning to profit a year earlier than expected. “
The group is confident of continuing its strong performance in fiscal year 2020 with its goal for sustainable revenue growth and profitability appearing “within reach”.
Shares rose 3.2% to 38.2p in late morning trading.