Computer Software's renaissance has been truly remarkable. In the past 12 months, the company has been transformed from basket case to growth stock.

CS used to be known as Software for Sport, which was, in truth, a rather curious corporate beast that focused on selling ticketing and customer relationship software to the sports sector. Despite the boundless enthusiasm of its backers, its main claim to fame was its ability to rack up losses.

For chairman Michael Jackson – a man more used to dealing with the endless global success of software giant Sage, which he also chairs – the situation was a headache. Realising the writing was on the wall, he responded by changing both the strategy and the products on offer.

The first tentative step was in January last year when CS bought Wizz400, an interactive business solutions provider for IBM's iSeries platform. To pay for the purchase, Computer Software issued 5.7 million shares (then worth £286,000) and £34,000 in cash.

On its own, however, the deal would not have been a life-saver. But it was followed in May by the purchase of a specialist accounting, distribution and payroll solutions provider, Chorus Application Software, for £1.5 million. Chorus reported a profit before tax to 2 December of £124,000. It came with assets worth £1.4 million.

To fund this deal – and to provide a cash cushion – Jackson raised £2 million from a variety of institutions. This placing was a fiendishly complex piece of financial engineering at a heavily discounted price. Many existing institutional investors were persuaded to participate but most private shareholders were significantly diluted.

The Chorus deal was one of the main reasons why CS reported its first operating profit – of £161,000 before goodwill amortisation and finance costs – for the six months to end-August last year. Turnover rose 40 per cent to £2.5 million.

At the end of 2003, the group announced its third acquisition, Springstone Software Services, which provides IT business solutions for the iSeries. CS completed another share rejig and issued in total 333,333 shares at 10p for Springstone.

'Acquisition and consolidation are key to Computer Software's strategy of growth', asserts non-executive director Vin Murria, who is also a partner at Elderstreet Capital Partners, the venture capital company that owns 23 per cent of the group.

Having built much of its business around Chorus products, the last acquisition is seen as a natural choice for vertical growth. More importantly, it will introduce CS's suite of products to a wider range of sectors. These range from chemical and general distribution, and insurance and banking to specialised manufacturing and food.

Springstone was just breaking even when it was bought. But Murria has high hopes it will be profitable within the next three months. She also says two or three more acquisitions are lined up for the near future.

In the original business, there are signs that more aggressive marketing and selling are starting to pay off. CS now supplies its ticketing and CRM technology to 40 per cent of all Premier League football teams. Its Talent CRM and e-business division counts clients such as Alfred Dunhill, Electrolux, Morphy Richards and Hellerman Tyton.

It has also picked up EMI, Capital Radio and the transport firm, Eddie Stobart, from Chorus. Meanwhile, Integra's membership solutions are deployed by professional institutes and trade institutions – the Chartered Institute of Housing and the Engineering Employers Federation are two examples.

House broker Seymour Pierce has yet to complete a briefing note or produce a forecast for the company, but it does believe that under Jackson CS is building a solid foundation for the future.

The shares have improved to 42p since the interims were announced in November, but they have much further to go.