Elexir optimistic about prospects

Elexir Technologies Holdings says the outlook for the remainder of its financial year looks challenging, but it has sufficient new business initiatives to be optimistic of acceptable results.

The company`s financial results for the six months to 28 February show a dip in net profit to R0.26 million from R0.63 million in the year-earlier period.

CEO James Casey says although turnover declined from R30.84 million to R27.88 million, gross profit margins increased with less reliance being placed on hardware sales.

"The turnaround in the group`s profitability has continued with the further development of new IT opportunities for managed services revenue streams."

Elexir achieved headline earnings of 0.18c a share compared with a previous 0.44c a share.

"As predicted in the 2002 annual report, the extremely tight conditions in the IT market have continued through the six months under review," Casey says.

"The outlook for the remainder of the year looks challenging, but the group has sufficient new business initiatives to be optimistic of acceptable results for the full financial year."

When Elexir`s last set of full-year figures were published in November they included a note from the group`s auditors pointing out that current liabilities exceeded current assets, indicating that "while the group`s financial position continues to strengthen, it could still be exposed to significant demands on its cash resources".

Casey has reiterated that the company`s directors believe that continued profitable trading enhances creditor claims over Elexir`s assets.