Dillistone Group (DSG: LSE), the AIM listed supplier of recruitment software to the international recruitment industry, reported a 2% fall in revenue but a 2% gross profit for the year that ended 31 December 2023.

Giles Fearnley, Non-Executive Chairman, said, "I am pleased to report the Group has returned to operating profitability in FY2023 for the first time since 2018. In a challenging market, the Group has delivered profit performance in line with expectations, paid down debt and continued to invest for the future."

Group revenue decreased by 2% to GBP 5.595m from GBP 5.699m in FY2022. Recurring revenue was 89% of the total.

The operating position, before acquisition-related, reorganisation and other items (adjusted operating profit) improved greatly to deliver a profit of GBP 0.220m from GBP 0.156m in FY2022. This is the Group's first such profit since 2018.

Inclusive of acquisition-related, reorganisation and other items, the Group made an operating profit of GBP 0.051m compared to an operating loss of GBP 0.319m in FY2022. This is the first profit at an operating level since 2016.

The loss before tax decreased to (GBP 0.104m) from (GBP 0.453m) in FY2022, representing a decrease in loss of 77%. This led to a small profit after tax of GBP 0.003m (FY2022: (0.183m)). Net cash from operating activities dipped slightly to GBP1,063m (FY2022: GBP 1.189 million) with a similar level of reduction in the change in cash and cash equivalents at minus GBP 0.441 million (FY2022 minus GBP 0.362m).

Dillistone splits its products into two groups. Products primarily targeting contingency recruiters (largely, but not exclusively, in the United Kingdom) under three brands: Infinity is a recruitment CRM, ISV.Online is an online skills testing product, and Mid-Office is a pay-and-bill solution. The recurring revenue of this part of our business was stable, generating a combined GBP 3.460m (FY2022 GBP 3.441m).

The second area is products targeting executive search firms and in-house executive search teams across the globe, including Talentis, FileFinder and GatedTalent. Following a 24% fall in 2021 and a 10% fall in 2022, revenue fell by 5% in 2023, totalling GBP 2.135m compared to GBP 2.258m in 2022. Talentis is seen as becoming the main revenue driver for the executive search division in the fullness of time and an upgrade for FileFinder customers.

The Group's strategy is to grow the business organically through product development, which In 2023 equated to 17.2% of revenues (FY2022: 17.4%)

Looking forward, Mr Fearnley said: "We have made a solid start to the year, with all products performing broadly in line with expectations in the first quarter. The Board is confident of making further progress in 2024."

Dillistone Group shares last traded at GBP 9.11, up 1.23% on the day and 13.89% above the 52-week low of 8.00 set on 19 April 2024. The company has a market cap of GBP 1.77 million.