IT services and outsourcing group Jem Technology Holdings (JemTech) has revised its forecast earnings per share down to 1c after losses sustained by several businesses hit the group`s bottom-line.
JemTech originally forecast net income of R4.5 million and earnings of 6.4c per share for the year to December.
The company has also restructured after an attributable loss of R2.7 million and a headline loss per share of 3.8c for the maiden half-year to 30 June.
Operating income of R1.2 million was achieved on turnover of R1.7 million.
"Several of the businesses acquired on listing were start-up operations which failed to achieve the results expected of them," says CEO Paul Cordier, commenting on JemTech`s maiden interim results for the half-year to 30 June.
"These operations have been closed down for the second half of the year, and all losses attributable to these businesses have been written off in the interim results."
He adds that the remaining business units are profitable and that a recovery can be expected in the second half, although the forecast earnings per share have been revised downwards.
"The group has restructured to form a smaller, but more focused entity, concentrating on the core areas of technology, being the mapping solutions and software-related businesses that gave rise to the group`s listing.
"Non-core businesses such as the graphics design studio and the SMS messaging business have been eliminated from the group in order to concentrate resources on the core competencies and revenue-producing activities," says Cordier.
An analyst says the financial notice does not provide adequate information. However, he notes that the share price is still higher than the group`s net asset value.
The company says its systems have been tested and results indicate it is "substantially" year 2000 compliant.
JemTech`s share, which listed on the JSE`s venture capital market on 3 December last year at an issue price of 50c, closed at 10c on Wednesday.
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