IT solutions group Contlan fell significantly short of forecast figures in its maiden year on the JSE. Turnover was 57% lower and earnings per share 98% lower than listing forecasts.
Results for the year to February show a turnover of R23.6 million, 57% lower than the forecast figures. Headline earnings per share of 0.13c were also way below expectations, down 98% on forecast.
Contlan finished its first year of trade on the venture capital sector of the JSE with an operating loss of R843 898.
On 28 February 2000 - one day before the books were closed for the year - Contlan issued a profit warning, saying it would not achieve its forecast target of R3.1 million after-tax profit. However, the board was adamant that it would still be in the black for the year.
The board attributed the results to an industry-wide slowdown in spending ahead of Y2K. Added to this was what the board described as "operational inefficiencies" within the company.
Remedial action was taken in March, when then CEO Kevin Connolly resigned in favour of Kerry Barris in an attempt to rectify operations and return the company to profitability.
Thereafter the company embarked on an aggressive marketing campaign which it says has paid off to some extent, attracting new clients since the campaign began.
Looking forward, the board says it has used the first three months of the new financial year to stabilise the company. The next nine months will be used as a consolidation period.
Contlan`s share price has fallen steadily since listing, from the 60c high in July last year to close at 10c yesterday.
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