Compu-Clearing Outsourcing has reported what its says are satisfactory interim results and says the strategic decisions taken by the group are yielding positive returns.
The JSE-listed provider of IT services to the customs clearing, freight forwarding and cargo industry increased turnover 14% to R13.79 million for the six months to 31 December 2000 from R12.07 million a year earlier.
However, operating income before interest rose only 6%, from R2.86 million to R3.04 million.
"During this period considerable sums were expended in training and further strengthening the employee base of the group," says chairman and CE Arnold Garber. "Particular emphasis was placed on service levels and achieving the correct mix for future anticipated growth."
He adds that this had the effect of raising costs and lowering operating margins in the short term.
Attributable earnings were flat at R2.44 million compared with a previous R2.48 million, while earnings per share rose from 5.2c to 5.5c.
The company had cash of R6.12 million at the end of the six months, compared with R12.78 million at the end of June. The net asset value was 61.44c a share, compared with 55.32c a year earlier.
On the cash flow statement, cash generated from trading operations rose from R4.37 million to R4.8 million, while cash flows from operating activities increased from R1.2 million to R1.45 million.
"Our profits are converted into cash in the short term," says Garber. "During this period cash resources were in the main utilised for the payment of taxation, the purchase of income-producing assets, and share buybacks."
Garber says the results for the period show a satisfactory performance and adds that the strategic decisions taken by the group are yielding positive returns.
The client base has remained "fiercely loyal" and new major customers were added during the period.
"Of significant note has been the establishment of a joint venture for the use of our systems in Singapore, with Semb-Corp Technologies, an industrial conglomerate listed on the Singapore Stock Exchange.
"Our first installation has been successfully completed and is being fine-tuned to the business environment in the Asia/Pacific region.
"This venture does not involve any significant capital amounts and will be cash flow positive by the end of this financial year."
Garber adds that the group expects an improved performance in the second half of the financial year.
The group`s share closed unchanged at 115c on the JSE yesterday.
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