Seartec`s Office Automation Divisions and new IT investment, the JSE-listed holding company for Sharp Electronics, pulled in the profits for the year ended June 30.
This was despite its consumer electronics and stationery divisions being hit by poor trading conditions.
Turnover for this focused distributor of office automation, consumer electronics and the Scripto range of stationery products was up 4,8 percent.
This was mainly due to its 51 percent holding in Compatible Information Systems (CIS), a specialist systems integrator in the IT arena which has been trading well.
But headline earnings fell to 13c a share (24,2c).
Dr Chris de Bruin, Seartec`s Chief Executive, said swift action had been taken to increase profits in the current year. The group was undergoing a clear restructuring of its business and product lines, significantly trimming the Consumer Products and Scripto stationery divisions.
"We have made some strategic decisions regarding the way forward and are already emerging sleeker and trimmer with fewer staff, smaller product ranges and a superior selection which will further differentiate us in the marketplace and provide acceptable profit margins.
"The past year has been a very tough one in the electronics industry, and most of our competitors have been even harder hit than us, but there seems to be light at the end of the tunnel in terms of interest rates and improving business confidence."
He said the group`s office automation operations were producing good results and were well placed to increase their profit contribution this coming financial year. The recent addition of the Duplo range of digital duplicators would help to diversify and strengthen the product range.
"The strategic focus of our business has, for some time, been moving away from consumer electronics and is developing rapidly around office automation and the provision of IT software and services. It is in these divisions that we see the most exciting sustainable growth for the group in the way forward."
The group will soon issue 3,4-million new shares - which will dilute headline earnings per share for 13c to 12,4c a share - as part payment for last year`s CIS acquisition.
The company has also decided to write down its R5-million equity investment in Kelvinator to R1 due to the poor trading conditions during this period. [From E-Data]
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