It has recently won a number of new customers including Innocent Drinks, Mid Yorkshire NHS Trust and Mercedes and has extended its contract with Ford as part of a move away from the stricken banking sector to more stable areas.

Yesterday the Hull-based company said that underlying full-year profits fell 2.4 per cent in the year to March 21 following the downturn in demand from financial services firms.

KCom said earnings before interest, tax, depreciation and amortisation (EBITDA) fell to £69.3m from £71m.

At the pre-tax level, profits fell almost 60 per cent to £4.4m after £7m was knocked off the ascribed value of acquisitions made in previous years.

The shares closed the day down 1p at 50p.

Chief executive Malcolm Fallen said the group's Telecoms and Internet Services division had a very strong year and revenues rose 9.7 per cent to £244.4m.

"We have seen continued strong performance from broadband and bandwidth services in both East Yorkshire and across the regions of the UK," he said.

New contract wins include North East Lincolnshire Council, Arco, Windsor Telecom and Northern Rail.

The broadband base stood at 203,000 at the year-end, representing year-on-year growth of 12 per cent.

But the group's Integration and Managed Services division had a more challenging year after it was hit in the second half by the slowdown.

The division offers more than simple telecoms and Internet services. It tends to deal with bigger businesses and it uses technology to help customers to solve business problems, such as improving the efficiency of a contact centre.

In a contact centre the technology can be used to route calls to the right people or data can be used to predict busy times.

Sales to the financial services sector, which represent about 25 per cent of the division's revenues, remain subdued, but Mr Fallen said there were signs of encouragement such as a £26.4m increase in the order book.

The division reported a 2.7 per cent increase in revenue to £278.4m. KCom deals with a number of leading banking institutions including Citigroup, Deutsche Bank and Lehmans.

Cazenove analysts said: "Whilst there may be some risk of travelling rather than arriving, given the share's strong run into these results, we continue to see significant value, primarily supported by KCom's East Yorkshire franchise."