JSE-listed software and service provider Global Technology (Glotec) has reached the halfway mark showing a healthy growth, mostly from its exposure to dollar-based earnings.
The company showed an increase of revenue of 49% from R128 million to R190 million for the six months to December. Operating income came in at R19.2 million, up 28% from the comparable period.
Attributable income sits at R16.7 million, an increase of 66%. A headline earning of 5.2c per share was reported for the interim period, which was up 27% from the 1999 period.
The company attributes the better than average growth to an expanded market penetration in new regions on a global basis.
Glotec has a 20% interest in US software company Temenos, and Glotec CEO Ray Leonard says the benefits of its exposure to the additional dollar revenue stream is indicated in the interim results - the first to include its US partner`s performance.
At the time of Glotec`s buy-in to Temenos, the company expected 80% of its income to be dollar-based. Leonard is, however, confident that the current 70% figure will grow to meet the 80% mark by the financial year-end.
Addressing the drop in operating margins to a negative value, Leonard comments: "We have been gearing up on our staff costs, especially our consultants, to export to Europe and Australia.
"A consultant takes between 18 to 24 months before they become profitable and we have recently employed 100 additional staff members."
Leonard says the company will not consider any major acquisitions in the near future, with the possible exception of a front-end package facilitator for the life assurance industry.
"With our share price where it is, any acquisition that is not cash-based is not attractive for us," he says.
For the same reason, he dismissed exercising an option to increase the company`s holding in Temenos, despite the attractiveness of the idea, although he says the company is eagerly watching the share price and will jump at the opportunity as soon as it arises.
By midday today, the Glotec share was trading 9c up at 105c.
Related stories:
Dollar earnings boost Glotec figures
Share
