Celebrus Technologies Plc (LON:CLBS) has made a stable start to FY27, according to the latest research note from Cavendish, which kept its 200p target price unchanged and pointed to significant upside from the current share price of 88p.
The broker said Celebrus has reported finals to March 2026 in line with the April trading update, delivering adjusted EBIT of $-0.9m from revenue of $23.6m, alongside a robust cash balance of $32.5m after share buybacks of $1.8m and dividends of $1.8m. Cavendish also noted that free cash flow remained strong at $3.8m.
Highlights from the full year results
- Revenue for FY26 was $23.6m, in line with expectations.
- Adjusted EBIT was $-0.9m, compared with $1.0m expected by Cavendish.
- Celebrus ARR reached $15.0m, up 10.3% versus FY25.
- Group ARR stood at $20.3m.
- Cash at year end was $32.5m, up from $31.5m in FY25.
- Free cash flow was $3.8m.
Cavendish said the year was challenging, but stressed that the outlook points to a return to growth after the second half reduction in Celebrus ARR. The note added that current ARR is not yet reported, but is expected to be slightly ahead of the year end figure, helped by new customer wins and upsells to existing customers.
The broker highlighted that FY26 is the first year of a rolling three-year contract renewal process, which will move licence revenue recognition to a monthly basis. That change is expected to dampen reported revenue and profits versus the cash reality during the transition period, but Cavendish believes the underlying cash profile remains strong.
On the operating side, Cavendish said there was no single reason for the lack of ARR progress in the second half of FY26. It pointed to a mix of customer-specific issues, including layoffs, reorganisations, new leadership and legal troubles at some prospects. Even so, the broker noted that FY26 ARR still grew 10.3% year on year, and that management has reported new logo wins and upsells in the first quarter of FY27.
Importantly, Cavendish said one of the outstanding contracts has now been landed, and that FY27 has the chance to echo the strong first half ARR performance seen in FY26. The note also observed that if two customers that reduced ARR due to disposals had fully churned, net revenue retention would have been above 100% based on retained customers. Instead, because they remain customers, NRR came in at 96.7% versus 104.1% in FY25.
The broker was encouraged by the company’s sales and customer success progress. It said Celebrus reorganised its sales team during FY26, with new hires in EMEA, while marketing now handles business development and pipeline generation. A seven-strong customer success team has also been established as a stand-alone function, and Cavendish said this has already helped simplify partner messaging and improve responses from the market.
Celebrus’ product set continues to evolve too. The note said the group is investing in R&D, including the v10 platform transition to Celebrus Cloud, and has added functionality such as funnel abandonment, a new AI Data Model and an MCP server. Cavendish said these developments position Celebrus as a data layer for AI applications within customer environments.
Looking ahead, Cavendish’s forecasts assume ARR growth to $18m in FY27 and $19.8m in FY28, driven by new contract wins and upsells. It expects headline revenue to be flat in FY27 because the company is moving away from forecast third-party low-margin hardware sales, but sees core revenue growing 16% in the year.
The broker also lifted its free cash flow forecasts, now expecting $1.5m in FY27 and $2.0m in FY28, helped by deferred revenue growth and better debtor management. With FY27E cash per share of 58p and an enterprise value of £9.1m, Cavendish said cash use can deliver a strong return to investors, while positive contract newsflow could provide further upside.
In its conclusion, Cavendish reiterated its 200p target price, describing it as equivalent to 3.7x FY28E rolling EV/Celebrus ARR, and said the valuation remains attractive relative to the current share price.
