Johannesburg Stock Exchange listed e-commerce company Hicor says it has more to offer investors than large information technology (IT) companies, and is not just "chasing profit" like other small-cap IT companies.
The company announced a restructuring in September, which saw then executive chairman Renier van Rooyen step down in favour of CEO Danny Pringle.
Pringle says, contrary to Hicor`s strategy, many smaller-cap IT companies are chasing profit almost at any cost in their attempt to attract investor attention.
"We however believe our focus for this financial year must be to build a solid foundation from which to re-launch the company. Profits are important, but improving the company`s balance sheet through a reduction of overall gearing and risks is now of critical importance for the future of Hicor. This is what we are focusing on for this financial year," says Pringle.
Hicor`s interim results are expected before the end of the week.
Pringle said the company`s short-term objectives include reducing overall gearing to a more acceptable ratio, reducing the risks associated with trading internationally and improving the management of company assets.
The company also aims to focus business operations on core business activities, improve product distribution channels, increase the base of its recurring annuity-style revenues and adhere strictly to corporate governance.
"We are grateful for shareholders` support over the past months, during which the company and the IT sector in general went through some rough times. Although the level of our share price is insignificant compared with the bigger IT company`s, Hicor remained a better investment to that of most other IT companies in SA compared on a percentage basis over the past six to twelve months. We have our shareholders to thank for that," he says.
Hicor share price hit a twelve-month low yesterday, trading at 18c from year highs of 85c.
Hicor reported a turnover of R46.4 million for the year to March 2000 with an attributable loss of R14.3 million and headline earnings of 2.3c.
Pringle said at the time he was adamant Hicor`s interim results would be significantly better than the year-end results reported in June.
The company currently has a market capitalisation of R16.2 million and a price-earnings ratio of 7.82.
Pringle says Hicor will appoint a non-executive chairman and two additional non-executive directors early in the new year to make the board more representative than in the past. The company will then have nine directors of whom four will be executive and five non-executive.
"Hicor is in the process of signing some local and international contracts which will not only serve as proof that we have developed technology of significance but will also form the base for our ability to grow the revenues we expect to realise in future."
Related stories:
Hicor announces management shuffle
Share
