Listed IT company Spescom sees Africa as a growth area, and will be increasing its presence on the continent.
The company, which is trading under a cautionary, is already present in Namibia, Mozambique and Mauritius. CEO Jen'e Palmer says the company will be building on its positions in Africa, especially in the Southern African Development Community region.
Founded in 1977, Spescom has four operating divisions. Its Media IT unit operates in the broadcasting space, while the telecommunications unit provides infrastructure. Its DataFusion division provides contact centre and enterprise telephony solutions. DataVoice provides voice recording, screen recording and speech analysis products.
Palmer says the company is exploring ways to grow its “critical mass”. She explains that Spescom is developing its three-year strategy and aims to build up its services offerings through adding more skills.
The company also wants to enter the public sector, which has not traditionally been a strong focus. Palmer says it is likely to partner with groups that already have a strong presence in government. She explains that this is a longer-term goal.
Building blocks
The past year was a “difficult trading year,” Palmer says. Spescom retrenched 22 staff members out of its base of 380.
“I think we've made the right decisions in 2009,” she says. The company focussed on trimming its debt levels, which dropped to under half of what it was. It also restructured its balance sheet, moving short-term debt into longer term facilities.
Palmer says Spescom is also becoming more entrenched as a managed services provider, which she sees as a growth area in the year ahead. “There are a lot of positive indicators coming to the fore, but 2010 is still going to be a difficult year.”
She adds that the company will also continue to focus on increasing the services component of revenue. “You need to be able to demonstrate your relevance in the food chain.”
Last year, the company grew its gross margins, which filtered through to an improved net profit of R8.7 million, from R7.4 million for the year to September.
Palmer explains that this was due to a bigger contribution from services. Services made up R95 million of the group's total revenue of R362.7 million. Last year, services added R63 million to revenue.
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