Turnover up 91%
Operating profit up 160%
Attributable profit up 205%
Headline earnings per share up 134%
Organic growth up 54% on turnover
Organic growth up 104% on operating profit
Balance sheet solid with significant cash reserves
Paracon Holdings Limited (Paracon), a leading provider of IT services and solutions, today announced it`s maiden results for the year ended December 1999. Paracon achieved excellent results with headline earnings per share up 134% to 7.5 cents compared to 3.2 cents in the previous year. This exceeded the prospectus forecast by 12%.
Turnover for the year under review amounted to R142.1 million compared to R74.5 million in the previous year, representing a 91% increase with operating profit before interest and taxation increasing 160% to R22.8 million compared to R8.7 million. The group achieved exceptional organic growth with growth rates of 54% and 104% in turnover and operating profit respectively. International operations contributed 8% of turnover.
Commenting on the results, Mark Jurgens CEO of Paracon said that the group`s first year as a listed company had been very exciting and successful. " It is particularly pleasing to exceed our expectations with these maiden results," he said.
During the year Paracon restructured its operations into three business units, IT Services, Business Solutions and Software Solutions and all three units achieved excellent growth.
"The group has rapidly moved up the value chain by expanding its IT solutions business" said Jurgens, "and we believe that there is a clear competitive advantage in our ability to provide our customers and clients with `best of breed` across the full lifecycle solution."
Paracon`s balance sheet remains solid with cash reserves in excess of R90 million, providing the group with a solid platform for growth and expansion. In addition, the group experienced strong cash flows from operating activities. Excellent working capital management resulted in the group`s debtors` days at 44 days.
"This healthy balance sheet places Paracon in an optimal position to pursue its acquisition strategy," added Jurgens. "The group has adopted a strict quality policy to this strategy focusing only on the acquisition of companies which are strategically positioned and complementary to Paracon`s operations, and in-depth financial and operational reviews are performed to ensure quality of earnings and growth potential."
Acquisitions during the last year included the remaining 50% of X-Pert Programme and Project Mangement (X-Pert PPM) and infoVu, a software solutions and services company.
"In addition, Paracon has recently formed a customer relationship management ("CRM") division and through the SalesLogix business partner programme is well positioned to leverage its existing expertise and systems integration, outsourcing and project management to offer the local market further services in the CRM arena and e-commerce environment."
"Another milestone for the company was the formation of Paracon International, in order to house the international acquisitions of the group," said Jurgens.
"In October 1999, a joint venture with Educor International, a Nasdaq listed subsidiary of Educor was formed whereby Professional Consulting Network (PCN), an IT services company operating in the USA was purchased."
"Our prospects for the year ahead are very exciting," said Jurgens. "The group is currently focused on three of the largest and fastest growing sectors in the IT industry namely staffing, outsourcing and CRM and we are well poised to take advantage of the ever-increasing shortage of local IT skills."
Share