Hello, thank you, and a warm welcome to everyone joining us today. We're delighted to report another strong trading period with accelerated growth and increased profitability. For those unfamiliar with us, Netcall is a U.K.-based enterprise software company. We help organizations achieve digital transformation faster and more efficiently, empowering them to become leaner and more customer-centric. Our clients often operate in complex, highly regulated sectors with many customers and employees. These environments can lead to labor-intensive processes, often hindered by legacy IT systems. That's where our Liberty platform really excels. It automates workflow and streamlines customer interactions, resulting in significant cost savings and improved customer experiences. One key to our success is the Liberty platform's low-code nature. It's user-friendly, so you don't need to be an IT expert to use it.
Our customers can quickly build and deploy any process they need, such as client onboarding or hospital workflow applications, without waiting for their IT team. We've regularly added capability to our platform through innovation and acquisition, including a wide array of AI tools and industry-specific solutions. Now we offer one of the most comprehensive low-code platforms on the market. Our primary sectors are healthcare, the public sector, and financial services, which together represent 90% of our operation. Our clients include major brands such as Santander, which use our solutions for mortgage approval, and Legal & General for claims management. We also have a growing network of technology and solution providers, providing more routes to market and complementary services for our customers. Financially, we've experienced robust growth. We've achieved revenues in the first half of over GBP 23 million, with 86% from recurring sources such as subscriptions and support contracts.
At the end of the period, we had over GBP 39 million in recurring contract revenue, with more than three quarters of that now from our cloud subscriptions. We have also maintained healthy profitability with a net cash balance of GBP 22 million after acquisition-related payments of GBP 12 million. Just before we get to the period's highlights, I want to recognize the team at Netcall. We have got 360 dedicated professionals who are really passionate about our customer success, and that is reflected in our top quartile employee engagement score and the fact that 9 in 10 customers asked would recommend us . We have had a strong start to the year. Revenue is up 22% to GBP 23 million, thanks to 12% organic growth and contributions from acquisitions. Our adjusted profits also rose by 18% to GBP 5.7 million. The main growth driver continues to be the strong uptake of cloud subscriptions by new and existing customers.
Subscription revenue increased by 45% to GBP 13.4 million, with 26% of that being organic growth. Cloud subscriptions now make up 94% of new product sales. Throughout the period, we've seen robust demand from new customers looking to modernize their customer service centres. We're particularly pleased with the results of our cloud investment program, which has led to a 41% increase in cloud contact centre revenues. Cloud subscriptions now represent 45% of Customer Engagement contract revenue, up 7 percentage points year on year, and we anticipate further growth from migrations and cross-selling. Our momentum was further accelerated in the period by our acquisitions of Govtech and Parble, which brought new complementary customer bases to the group. In terms of market verticals, we've continued to build momentum in the insurance sector, including securing a three-year, GBP 1.8 million contract with a global law firm to support claims management for their TPA business.
This incorporates multiple elements of the Liberty platform and our newly acquired solutions. At a macro level, the government-led drive to increase efficiencies across the NHS and local government continues to be a driver for us. Our tailored industry solutions, backed by strong ROI from real case studies, and I'll give some examples in a moment, are highly sought after in these areas. Our strong financial position and higher recurring revenue enable us to keep investing in innovation. We've introduced more product during the period, with frequent releases embedding further generative AI features across the Liberty platform and new upgrades to our industry-specific hub solutions. The positive momentum has continued into the second half of the financial year, giving the board confidence in meeting its expectations and completing another successful year.
Liberty is a powerful cloud-based platform that helps organizations analyze their process, streamline document workflow, manage multichannel interaction, and develop applications with little or no coding. Powered by artificial intelligence, it drives efficiency and innovation, making things better for both employees and customers. What sets Liberty apart is its systems integration of automation and Customer Engagement technologies. This allows clients to easily incorporate interactions into their workflow and vice versa to address a wide range of automation use cases. Plus, it's super intuitive and user-friendly for both users and professional developers. This means quick automation and a broader talent pool, which speeds up delivery times. For example, in the financial service industries, Liberty powers portals for client onboarding, quotes, placements, and claims management. West Brom Building Society, for instance, reduced account opening times by about a third, allowing them to scale and bring new products to market quickly.
We also offer pre-configured solutions for various market segments built on our Liberty platform or hubs. These packages help customers achieve value quickly, and through customer-shared content on our AppShare and contribution from our vibrant set of community members, we create a strong network effect. We have developed over 15 chargeable hub or hub extensions, increasing our market reach and making the platform even more desirable. In healthcare, our Patient Hub is used by over 2 million patients and has saved healthcare providers an estimated GBP 65 million by reducing no-shows and cost. For example, Rotherham NHS Foundation Trust deployed a number of solutions, including Diagnostic Booking and Waiting Well applications, which helped reduce their waiting list by 10%, cut do-not-attend rates in diagnostics from 8% to 2%, and improved booking centre productivity by 30%-40%.
In the public sector, our Citizen Hub and Tenant Hub offer dozens of pre-built modules and automations. Cumberland County Council, a newly formed unitary authority, used the Liberty platform to streamline and unify functions, launching over 100 digital service applications to improve efficiency and make real cost savings, all done in a very short period of time. This excellent case study shows the support we can give to local government's devolution and reorganization agenda. We also focus on partnerships with service providers, enabling them to create their own software solutions and recurring revenue streams, adding income for Netcall in other markets. A good example in the period is a partner in New Zealand that achieved the first international sale of Citizen Hub, providing a foothold to unlock further potential clients in the region.
This approach allows the group to leverage its IP and expand into new markets at a lower cost, with the partner in this case taking on localization configuration, support, and customer acquisition. Liberty is a scalable platform that can grow both through innovation and complementary acquisitions. As automation technologies converge, organizations are increasingly looking for platforms that cater to the end-to-end need of a wide range of automation use cases. In other words, they want a unified solution that provides an interconnected portfolio of capability rather than a collection of individual tools. Our M&A strategy is designed to capitalize on this convergence by targeting providers of emerging, adjacent technology or industry-specific solutions. We see a lot of opportunities out there to add to our capabilities from both existing and new customers to drive two-way cross-sale and cost synergies.
For example, during the period, we acquired Parble to add AI-powered intelligent document processing to Liberty. We also acquired Govtech, a specialist in digital process automation for local government, where we're using Liberty to create cost synergies and enhance our Citizen Hub proposition. The market for digital process automation and cloud-based contact centres is growing rapidly, driven by the increasing adoption of cloud and AI technologies. In the U.K. alone, our target market roughly represents several hundred million dollars, and globally, industry analysts estimate the market at around $40 billion, growing at 20% annually. Of course, we only need to capture a small slice of that to be successful. Yet many businesses still rely on manual processors and outdated systems, which hurt efficiency and the effective use of AI.
For instance, over 80% of customer service issues aren't fully resolved through self-service due to disorganized data and a lack of automation. Organizations are just starting to harness modern tech to manage and process unstructured data and customer interactions stimulated by advancements in generative AI. While there's a load of excitement, there's still a long journey ahead. With reports that employees will use generative AI for about 30% of tasks within five years, significant potential opens up for providers like Netcall to support clients in their adoption. Generative AI is also driving self-service investments in customer service and support, with three quarters of function leaders feeling pressure from their C-suite to implement it to boost productivity. There's a skills gap in digital AI and process expertise.
That's why three quarters of automation work is expected to be done by business users, making easy-to-use tools like our Liberty platform absolutely essential. To target this market, we have a four-part growth strategy: acquire new customers, expand within our customer base, grow our partner network, and product innovation. I think we're making terrific progress. We've doubled our new customer sign-ups this period across sectors like insurance, local government, retail, and health. These new customers are adopting a mix of automation and engagement solutions. Typically, they start small with a single workflow or challenge and expand usage and add more solutions over time.
Therefore, our success is tied to our customer success, which is reflected in our 115% cloud net retention rate, fueled by cross-sales of hubs, hub extensions, or acquired products, migrating services to the cloud, upselling new features or increased usage, and maintaining really high retention rates, all backed up by our outstanding customer service. We continue to expand our partner network, adding 10 new partners in the period, bringing our total to over 50. Sales through indirect channels account for 20% of all the bookings. The launch of Converse CX at the end of the last financial year has sparked significant interest, with several partners now accredited and securing wins, including a U.K. high street retailer that otherwise we would not have been able to reach. We're also gaining international traction. Along with our first partner win in New Zealand, we're seeing similar opportunities emerge with partners in other geographies.
Lastly, we continue to innovate new platform capability. For example, we launched our retrieval-a ugmented generation pipeline, Ask Liberty, that offers intuitive conversational AI for questions and answers, grounded in real customer content, which has been successfully deployed for agent guidance and call scripting. Our success is driven by our growing customer footprint and an expanded addressable market through a broader product suite and complementary acquisitions. Looking back, we have achieved a 22% annual growth in total ACV, reaching GBP 39 million since December 2020. This includes 18% growth and GBP 5 million from acquisitions. Our core markets, health, government, and financial services have all shown good annual growth rates of in excess of 19%, respectively. Our recent acquisitions are already showing promising signs of cross-sale pipeline conversion. Customer interest in Parble IDP has been very good, and we have already made our first IDP sale into the Liberty base.
We're expecting the product integration to be released next month. With Govtech, we've expanded our customer base from one in four to one in three councils. This provides an entry into the revenue and benefits function, complementing our existing applications across citizen service and housing. Our first sale of Liberty into the Govtech base is complete, and we're currently enhancing both solutions to drive further growth. Our internal development effort continues to add value for clients and support increased adoption. The launch of Converse CX, our new contact centre as a service solution, has generated strong interest. We successfully cross-sell automation products to engagement customers, improving their end-to-end interaction handling. Currently, 29% of engagement customers have automation products, up 6 percentage points year on year. Now, with the AI capability of CX, we're also cross-selling engagement solutions to automation customers, particularly in service centre use cases, further expanding our TAM.
We're also developing the capability to generate apps from Liberty Spark process maps using generative AI, with faster app building strengthening the case for cross-selling Liberty Create to Spark customers and consultants. Our expanded customer footprint also increases our upsell opportunities. We're seeing a major migration to cloud contact centre. The mix of cloud subscriptions in Customer Engagement ACV has more than doubled from around 20% in December 2020 to 45% today. As we gain traction, we're looking at a GBP 13 million opportunity to migrate our remaining support contracts to the cloud, which helps unlock further potential for selling more AI features. Growth through customers, automation, and application rationalization programs continues to show really strong results. Take Newcastle City Council, for example. They've grown their annual subscription from GBP 20,000 to GBP 250,000 over a few years by rolling out new apps for citizen services.
They also replaced several corporate systems, such as a CRM and a help desk, with Liberty-built apps that funded this purchase with savings of over GBP 1 million over a five-year period. This example is one of many, with other high-growth accounts in other sectors, such as transport, utilities, and insurance. We have launched or are developing several hub extensions, such as more health solutions and housing repair apps, expanding our TAM by several hundred potential sales opportunities. AI is embedded throughout our offerings, driving license upsell and increasing annual recurring revenue over time as AI is consumed more widely. Today, two in three CX customers opt for Liberty AI, and we are encouraging adoption.
I would say overall, we're automating more workflow and interaction for a broader customer base, providing the foundations for future cross-selling success and a growing wallet share as we support customers at more stages of their automation journey. Now I'll hand over to Richard, who will take you through the financials.
Thanks, James. Performance in the first half of the year was strong, and our growth has been driven by both organic increases in cloud subscriptions and contributions from M&A. Total revenue was 22% higher year on year at GBP 23 million, driven by cloud revenues, which grew 45% year on year to GBP 13.4 million. Demand for automation and engagement cloud subscriptions drove total ACV 31% higher year on year at GBP 39.4 million, which was a 15% year-on-year growth on an underlying basis.
The higher ACV also drove higher remaining performance obligations, where contracted revenues, which will be recognized in future periods, increased to GBP 71.1 million at the 31st of December, a 23% year-on-year increase, providing great forward revenue visibility. EBITDA margins were in line with expectations at 25%. Absolute adjusted EBITDA was 18% higher year on year at GBP 5.7 million. Adjusted EPS was 7% higher year on year at GBP 2.22 per share. Cash conversion is typically higher in the second half of the financial year due to the timing of annual billings for cloud service and support contracts. Additionally, during the period, over GBP 12 million was paid out for M&A-related items, resulting in a net cash position of GBP 22 million at the 31st of December. Cloud subscription revenues approached 60% of the group's revenues in the period, delivering 58.3% of total revenues.
Cloud ACV was GBP 29.9 million at the 31st of December, a year-on-year increase of 47%, and is now over three and a half times the level seen at December 2020. Growth in the period was driven by our robust expansion in customer accounts as our customers continued to adopt additional Netcall products, along with ACV from new logos and M&A. We continue to see a very healthy net retention rate, being the percentage of ACV retained from existing customers, including expansion, downgrades, and cancellations measured year over year, of 115% in the period. This amount also excludes ACV from acquisitions in the period. Cloud ACV from acquisitions completed since the comparative period was GBP 5.1 million, meaning year-on-year underlying growth was 25%. Total ACV, including maintenance contracts, grew 31% year-on-year to GBP 39.4 million, or 15% year-on-year on an underlying basis.
Higher margin cloud ACV is now 76% of total ACV, an increase of 7 percentage points from June 2024. Cloud deployments were 94% of new product bookings in the period. Support ACV was robust at GBP 9.5 million as customer migrations to the cloud were partly offset by continuing customer expansion and renewal price indexation. We continue to see significant cross-sale opportunities, which have expanded as a result of the three acquisitions in 2024, examples of which are where we continue to sell intelligent automation into Customer Engagement customers, which delivers approximately a three-times uplift in their ACV. At the end of the period, around 29% of Customer Engagement customers had purchased intelligent automation, up 3 percentage points from the June 2024 position. If these metrics apply across all customers, this represents an annual opportunity of over GBP 20 million.
Additionally, when we migrate our on-premise contact centre customers to the cloud, we see around a 50% uplift in their ACV, which represents around an annual net GBP 4 million cloud subscription opportunity. We also now see significant ACV opportunities for cross-selling intelligent automation and Customer Engagement products into Skore, Govtech, and Parble customers, along with the inverse of selling acquired products into existing Netcall customers. Total RPO at the end of the period was GBP 71.1 million, a GBP 13.1 million, or 23% increase on the same period last year. 92% of this relates to cloud and support contracts. Current RPO, which is contracted revenue that is expected to be recognized in the next 12 months, is 52% of the total and grew 17% to GBP 37.1 million. RPO greater than one year grew GBP 7.8 million, or 30%, to GBP 34 million.
Total RPO from acquisitions in the period added GBP 6.4 million, of which GBP 3.6 million is to be recognized in the next 12 months. The order book now covers a significant proportion of revenues for the second half of the year and into FY2026. The strong ACV growth from automation and engagement cloud subscriptions continues to be the major driver of the group. As mentioned earlier, cloud revenues represented over 58% of the GBP 23 million total revenue in the period. Total revenue growth in the period was 22%, and excluding the impact from acquisitions in the period and the 2023 contract renewal, rose 12% year on year. Recurring revenues were 27% higher year on year at nearly GBP 20 million and now represent 86% of total revenue, an increase of around 4 percentage points on both the comparative period and June 2024 positions.
Cloud revenues continue to grow strongly, following the same pattern in ACV, with revenue up by 45% year on year to GBP 13.4 million, being a 35% cumulative annual growth rate from the half-one FY 2021 position of GBP 4.1 million. Recurring revenue from product support contracts and communication services was GBP 0.1 million higher year on year at GBP 6.3 million. This is split between support contract revenues of GBP 4.8 million, which followed ACV levels and delivered revenue slightly lower than the comparative period by GBP 0.1 million, and communication services revenue, which was GBP 0.2 million higher year on year at GBP 1.5 million, driven by higher fees from financial service sector customers. Non-recurring revenue from products and services was GBP 3.3 million, comprising product revenue and software license sales with supporting hardware of GBP 0.6 million, which was GBP 0.4 million lower than the same period last year and was in line with expectations.
Professional services revenue, which increased by 10% year on year to GBP 2.7 million, as customer demand for full application development versus support of their own development teams varies from period to period. The higher ACV and RPO positions provide greater visibility of revenues in the second half of the financial year and beyond, with opportunities to drive further expansion throughout the periods. In addition to ACV growth, another KPI that we track closely is operating margins. Our financial strategy to date is to grow EBITDA margin sensibly over time, over the last few years targeting around a 30% flow-through of incremental revenue growth to the bottom line. EBITDA margin in the period was 1 percentage point lower year on year, but in aggregate, 18% higher on a cumulative annual growth rate basis since the FY2021 half-year position.
The margin delivery in the period reflects the increased contribution from cloud services and productivity gains, offset by the investment program into the group's cloud Customer Engagement offering and the impact of acquisitions in the period. Reflecting these impacts, adjusted EBITDA grew 18% year on year to GBP 5.7 million, of which GBP 0.46 million relates to acquisitions in the period. After removing the impact of the group's investment program into our Customer Engagement offering and acquisitions in the period, organic incremental adjusted EBITDA growth was over 30% and in line with our ongoing target. Our business model is largely based on annual in-advance contract billings, which combined with a growing business delivers excellent cash generation on an annual basis. Previous periods have benefited from the timing of cash inflows relating to the 2022 contract win and subsequent 2023 renewal.
The most recent invoice was paid in the second half of FY2024 rather than the current first half period. Therefore, adjusting for this timing difference, cash flows from operations as a proportion of EBITDA remains consistent with the previous two first half periods. Cash conversion is typically higher in the second half of the financial year due to timing of annual billings for cloud service and support contracts. We are well positioned for a consistent half-two delivery. Cash flow in the first half also reflected billings of GBP 17.4 million in the period. Adjusted profits were GBP 0.3 million, or 10% higher than the prior period, which have led to a 10% year-on-year increase in adjusted EPS to GBP 2.22 per share.
The different rate of increase in adjusted profits compared to EBITDA predominantly reflects lower net interest income of GBP 0.19 million than the prior period due to cash payments made for acquisitions and represents GBP 0.09 of adjusted EPS and GBP 0.2 million of higher cloud software platform asset amortization than the prior period, the increase representing GBP 0.13 of adjusted EPS. In line with the company's dividend policy to pay out 25% of adjusted EPS as a final dividend, we paid GBP 0.89 per share in February to shareholders, which totaled GBP 1.47 million. Adjusted net funds decreased by GBP 13.8 million year-on-year to GBP 19.7 million at the half-year position. The table on the left analyzes this period's movements, which predominantly relate to M&A. It's important to note that the previous year-end cash balance of GBP 34 million has allowed us to fund the post-year-end acquisitions of Govtech and Parble out of existing cash resources.
The group continues to be debt-free. Our financial position supports our organic growth strategies and provides a great platform for continued growth through both organic and inorganic means. I'll now hand back over to James.
Thank you, Richard. Our outlook remains positive as we continue to build on our successes. We've had a strong business performance this half, and we've seen the positive trading momentum continue into the second half of the financial year. Our recent acquisitions and the expanded product portfolio have opened up new business opportunities for us in the highly attractive digital process automation and cloud contact centre markets. We're focusing on our organic growth opportunities. At the same time, we continue to evaluate complementary acquisitions to enhance our capabilities. With a solid financial position, a growing base of contracted revenue, and a healthy pipeline of opportunities, we're confident in completing another successful year.