Metropolis reports better than expected loss

By Iain Scott, ITWeb group consulting editor

Johannesburg, 23 Aug 2001

Metropolis Transactive Holdings has published what may be its final set of annual results as a listed company, reporting a better than budgeted headline loss.

CEO Sean Hirschowitz says this is due to a continued enhancement of systems at the company, which resulted in a substantial reduction in operating costs.

He expects the positive trend to continue in the coming year.

Metropolis, which operates the iafrica.com consumer Internet portal, disposed of its original information management business and closed its business-to-business division after transferring the business-to-business communities to VerticalNet.

"As a result, no contribution to operating loss was made by B2B during the 2001 fiscal year," says Hirschowitz.

"The management team focused on the growth of iafrica.com. In addition, a number of new joint venture e-commerce agreements were concluded and the Private Label ASP division launched."

Hirschowitz says that due to the termination of the iafrica.com default home page setting on the dial-up Internet service provided by UUNet SA, Datatec compensated Metropolis with R8.75 million to offset any potential loss of revenue in 2000 and 2001.

The company received R5.5 million in the 2000 financial year, and R3.2 million in the 2001 financial year, and this was included in the revenue figure.

The two largest shareholders, Primedia (which owns 49.18%) and Datatec (19.7%), announced last month that they intend to propose a scheme of arrangement in terms of which they will offer to buy the shares they do not own.

The intention is to follow that with the delisting of the Metropolis share.

The share was unchanged at 38c this morning.