Cerillion (LSE:CER), the billing and customer management software supplier to telecoms operators, has warned that results for its financial year to 30 September 2026 will fall below market expectations because customer orders were delayed or deferred. The warning is a notable change of tone for a company that has long been regarded as one of the steadier names on AIM.

What the company does

Cerillion supplies software for billing, charging, customer relationship management and related functions, mainly to telecommunications operators and also to other subscription businesses. LSE:CER's Revenue combines software licences, ongoing support and services, and its customers tend to sign multi-year contracts that are then expanded over time.

Latest developments

In a full-year trading update, Cerillion said revenue would be in the range of £46 million to £48 million, compared with £45.4 million in the prior year. It guided to an adjusted EBITDA Margin of 43 to 45%, against 50.9% a year earlier. The company said orders, including software licence expansions and upgrades, had been delayed or deferred. It added that major implementations were progressing, the back-order book was solid and the pipeline of new customers was healthy.

The warning followed an earlier one. In April 2026 LSE:CER issued a half-year trading update flagging lower interim revenue and earnings, and its shares fell. Interim results published on 1 June 2026 showed revenue for the six months to 31 March 2026 down 14% to £18.0 million and adjusted pre-tax profit down 41% to £5.5 million. The company attributed this to the timing of revenue recognition, with substantial licence revenue expected in the second half. Net cash was £32.5 million, and a record back-order book of £82.1 million was reported, up 64%, with new orders up 102% to £39.6 million. The Interim Dividend was raised 15% to 5.5p per share. A separate commentary at the time had referred to a contract with Omantel lifting order intake.

Financial picture

The numbers illustrate a Business with a solid Balance Sheet and order book but with revenue that is difficult to time. Net cash of £32.5 million at the half-year end supports the dividend and gives flexibility. The margin guidance still implies a profitable business, though the move from about 51% to a range of 43 to 45% is a clear step down, partly reflecting lower licence income against a largely Fixed Cost base. The latest trading update gave no specific cash figure.

Sector and index context

Cerillion (LSE:CER) is one of the better-known software groups on the FTSE AIM All Share Index. Telecom operators have been cautious with Capital spending, which can push out licence expansions and upgrades even where a vendor is embedded in their operations. Larger competitors in the billing market have greater scale, so long-standing relationships and implementation track records are important for smaller suppliers.

Key risks

Order timing is the main risk. If deferred orders slip further or are cancelled, revenue and margin could fall again. A large order book is only valuable if it converts into delivered work on schedule, and customer concentration among telecoms operators amplifies the impact of any single delay. Cost inflation, currency movements and competition could add pressure, while shares that have already reacted to two warnings may be sensitive to further news.

What to watch next

The full-year results for the year to 30 September 2026 will give the definitive revenue, margin, cash and dividend figures. Investors will look for evidence that deferred licence orders are being signed, how quickly the back-order book converts and whether management gives an outlook for the next year.