Business communications company DataPro achieved headline earnings of 2.5c a share for the year to end-August, its first full-year results since listing on the JSE last year.
The company changed its year-end to 31 August with effect from last year, when it reported results for a six-month period.
Revenue for the year totalled R96.9 million, with gross profit of R40.97 million. Earnings before interest, tax, depreciation and amortisation came in at R12.05 million.
DataPro recorded an operating profit of R5.65 million and a pre-tax profit of R3.3 million, with a R4.81 million net profit translating to earnings of 2.1c a share.
The balance sheet shows year-end current assets of R14.88 million, of which cash accounted for R2.36 million, with current liabilities at R39.95 million. The company`s net asset value amounted to 29.8c a share, while the net tangible asset value per share was -0.15c.
CEO Doug Reed describes the period as "the most dynamic year ever" in SA`s telecommunication sector as a result of technology enhancements and the growth of the Internet, coupled with deregulation.
"DataPro`s target market has increased from R1.2 billion to an estimated R40 billion per annum and presents a variety of opportunities," he says, adding that DataPro, a traditional Internet service provider to businesses, has capitalised on deregulation to position itself as a "complementary and viable alternative to Telkom".
Reed says the board is happy with the results given the backdrop of the fast-evolving and changing telecommunications industry. He says the telecommunications environment dictated a change from the pre-listing strategy, resulting in a redeployment of resources towards building a strong voice-related business under the VoxTelecom brand.
The strategy during the year "was to limit the cash resources allocated to the voice start-up to the cash flows generated within the business".
He says the start-up costs of the voice business had a major effect on the results.
"The total cost of developing the voice business in the first six months amounted to around R4.6 million, comprising mainly increased marketing, training and additional personnel.
"In the second half of the year this increased by R3.4 million to approximately R8 million due to the additional network capacity built to carry voice, a resultant increase in depreciation and the costs of piloting and testing, which increased bandwidth costs."
However, he says the investment is essential to the strategic value and long-term growth of the group.
DataPro`s share, which closed 1c up at 51c on AltX yesterday, was trading at 55c this morning.
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