Redington · forward-looking guidance across the available source record.
Guidance tracker
Software Solutions Group (now reporting as combined entity) is expected to grow 30-50% over the next 6-12 quarters, building on the 48% growth seen this quarter. Cloud, cyber security, and software pieces are contributing roughly equally with professional services below 10% but set to grow.
The Vodafone Connect sale (concluded this quarter) and ongoing TL business exit should materially reduce Arena losses from Q4 FY26, with full benefit flowing through from FY27. Interest cost savings expected at ~$23M annually.
Management sees good outlook for India, UAE, and KSA for at least the next 2-3 quarters across all business units. Mobility momentum expected to continue; PC refresh could be stronger in H2 if India trend continues.
Opex will increase incrementally to fund SSG capabilities—technical pre-sales, digital platform (CloudQuarks) enhancements, Red Academy training, and ecosystem development. Returns expected to justify investments given SSG's higher gross margins.
Management expects ROE to range between 18-20% going forward (floor of 16%), down from Q3's 22.1% which is not considered sustainable at current mix.
Software Solutions Group expected to continue 40%+ growth across all markets (India, Middle East, Africa, Turkey, Southeast Asia) driven by hyperscaler partnerships, software, and cybersecurity.
Normal working capital range expected at 35-40 days; current 28 days partly reflects favorable mix from mobility growth and Arena deleveraging.
Expect Arena losses to continue declining toward break-even in 2027 as local currency and connect businesses are exited; steady state revenue seen at ~$400 million (50% drop from prior year ~$1 billion).
Management expects India momentum to sustain, while Middle East will be soft in Q1 and possibly Q2 due to the West Asia crisis.
SSG (cloud, software, security) expected to maintain or accelerate growth above 30%, driven by cloud, AI exchange, and security catch-up.
Elevated opex due to capability building in SSG and technology will persist for 1-2 years, but AR provisions and war-related costs should normalize.
Excluding Arena, management expects EBITDA margin of 2.2-2.4% and RoCE above 18% (currently ~20%).