Delays in the awarding of key contracts have hurt IST Group, which has reported an 87.2% decline in headline earnings per consolidated share.
Although revenue for the six months to 31 August rose by 19.2% from R148.58 million to R177.16 million, headline earnings fell from 10.2c per consolidated share to just 1.3c.
"While revenue for the period was up by 19% against the first half of 2003, this was largely attributable to the sale of relatively low-margin services," says CEO Harry Coetzee.
"The cost of sales consequently increased, and the results were further impacted by the delays referred to in the cautionary announcement (published on 17 August), a loss in the Delkkor division, a significant increase in the headcount following last year`s acquisitions, and the generally challenging operating environment.
"As anticipated, there was therefore a substantial decline in earnings and headline earnings per share."
Coetzee says that apart from Delkor, which suffered from a reduction in expenditure in the mining sector, all divisions recorded positive results, but none met their targets.
"All are budgeting for an improvement in the second half of the year, but this is contingent upon the finalisation of major contracts."
The results are IST`s last before delisting from the JSE at the end of the month.
Share
