Dialogue Group Holdings is working out how to move forward as the existence of another two call centre subsidiaries hangs in the balance.
In February, the group applied for liquidation of Dialogue SA, because the call centre had too many costs and not enough revenue. As a result, the holding company reported a R69.9 million expense, because the company was in liquidation in accordance with accounting rules.
However, as Dialogue SA has been wrapped up, the holding company can now report a gain on its disposal of R65.7 million. This reversal aided Dialogue Holdings in reporting a net profit of R40.9 million for the six months to June from revenue of R104.6 million.
Dialogue SA made a R7 million loss from continuing operations during the half year, which strips out companies that are in the process of being disposed and units that have been discontinued, compared with a R6.8 million loss a year ago. Last year, the company reported revenue of R109.6 million and a net loss of R13.99 million.
Dialogue says it continued to experience difficult trading conditions during the half year and has been focusing on cost savings to maintain profitability. CE Alan Farthing says the board is currently assessing the company's future strategy and will communicate this in due course.
Closing shop
The company says lower consumer spending has negatively impacted the group's customer base, and it is experiencing pricing pressure, as well as less appetite for contract renewals. Sibize's major client has decided to terminate its call centre outsourcing contract two years early and Interaction's major client has cancelled its outsourcing agreement.
As a result of the contract cancellations, says Farthing, it is highly likely that both Sibize and Interaction will be discontinued.
CallForce is still experiencing lower volumes of temporary staff placements, but has managed to narrow its loss from R2 million to R400 000, due to a cost reduction programme. “This business remains dependant on growth and employment opportunities in the financial services sector,” says Dialogue.
Farthing says although ContinuitySA was also impacted by tough trading conditions, it is profitable. Dialogue explains that companies are delaying implementing business continuity plans. ContinuitySA's investment into Mauritius is close to break-even on a month-to-month basis and the company is looking for opportunities to expand its operations in Africa.
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