JSE-listed Faritec Holdings says it is emerging from the worst of its restructuring pains and is looking towards a stronger second half.
Faritec has marginally grown its revenue for the six months to December 2000. An increase from R116.6 million to R118.1 million for the comparable period was reported.
However, operating profits were down to R4.3 million from the R13.2 million turned in for the previous year`s results.
Headline earnings per share of 3.2c are down on the 8.3c for the comparable period in December 1999.
However, cash on hand grew from R27 million to R32 million. Faritec MD Simon Tomlinson says the company will be holding onto this cash fund, as it is difficult to raise cash in the current market.
Tomlinson says Faritec is in the pilot stages of its e-commerce development and expects the new operation to be a cash drain, for which it does not want to go into debt.
The company has a two-fold business, split between products and services, and Tomlinson says a strong services division will put Faritec in a strong position to grow its annuity-based revenue into the future.
"These figures represent a group that has been focused on rebuilding and restructuring. While the business is not yet quite where we want it to be, we are relatively pleased with what we have achieved."
He is confident the group`s second half will show an improvement on the current figures, saying there is traditionally a 40% to 60% split between first and second half revenue.
Tomlinson says the MDS joint venture exceeded Faritec`s expectations, achieving profitability a year ahead of management forecast. However, lower margins than those of the South African operations negatively impacted overall group margins.
He expects operating margins to remain at their current levels in the second half of the financial year.
Related stories:
Faritec takes a beating after deal abandoned
Share
