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(Sharecast News) - Checkit said on Thursday that it delivered break-even adjusted EBITDA for the year ended 31 January and generated cash in the second half, as cost savings and a shift towards higher-quality recurring revenue offset a modest decline in total sales.
The AIM-traded provider of automated monitoring and operational intelligence software reported full-year revenue of 13.7m, down 2% from 14.1m in 2025, reflecting lower non-recurring revenue.
Recurring revenue increased to 96% of total revenue from 94% a year earlier.
Annual recurring revenue was 14.3m, down 1% year on year, but up 2% at constant currency.
Excluding a 0.4m ARR contraction from a single large US customer announced at the interim results, underlying ARR grew by 5% at constant currency.
Contract durations increased across around a quarter of the revenue base, enhancing forward revenue visibility.
Adjusted EBITDA was 0.0m for the 2026 financial year, compared with a loss of 2.3m in FY25, and 0.5m positive in the second half.
The group delivered 4.0m of annualised cost savings during the year.
Net cash as at 31 January was 3.0m, up from 2.7m on 31 July, reflecting a cash-generative second half, though down from 5.1m at the end of FY25.
Management said FY26 marked a significant inflection point, with a focus on profitability, cash generation and revenue quality.
The company said it entered FY27 with a lower cost base and a strengthened pipeline, and intends to increase emphasis on its core platform, including the rollout of a new user interface and further development of its operational intelligence capabilities, while maintaining financial discipline.
"FY26 was a pivotal year for Checkit - we completed a structural reset of the business, delivered Adjusted EBITDA break-even ahead of market expectations and generated cash in the second half," said chief executive Kit Kyte.
"Importantly, we have strengthened the quality of our recurring revenue base through long-term renewals and disciplined commercial decision-making.
"With a lower cost base and a strong pipeline, we enter FY27 positioned to pursue growth."
At 1208 GMT, shares in Checkit were up 4.35% at 18p.
Reporting by Josh White for Sharecast.com.