UCS aims to double up

UCS's international operations could see it double revenue within the next five years, says the retail software solution company.

The firm this morning reported revenue growth of 22%, to R1.5 billion, for the year to September, but once-off costs and exceptional items hit net profit, which lost 80%, to R14.87 million.

CEO John Bright says: “Local and international market conditions remained very challenging during the past year, especially for businesses such as UCS with a large exposure to the non-food retail sector, which was hard hit by the decrease in consumer spending.”

He adds that the company is looking forward “with cautious optimism to gradual improvements in trading conditions across our targeted international markets during 2010”.

UCS has streamlined its operations and is now focused on the retail value chain, from store to distributor, and aims to grow internationally, says deputy CEO Dean Sparrow.

During the year, the company sold several non-core entities, which included DiverseIT, the enterprise solutions division of UCS Solutions and TSS Managed Services.

These investments went into building channel relationships, as well as direct sales pipelines for UCS Software Manufacturing in the UK, US and Middle East regions.

UCS has also continued to invest in its Aquitec business in the UK and Chicago. Aquitec provides software and services for large-scale warehouses and distribution centres. The company also invested in UCS Solutions Incorporated, operating in Philadelphia, which provides SAP all-in-one solutions for the retail value chain.

Sparrow explains international retailers are keeping a lid on costs, and delaying investment in technology. “The continuing global economic crisis resulted in contracts being postponed or cancelled in some of our main international expansion areas, namely the US, UK and certain Middle East markets,” says UCS.

However, UCS is now positioned for when retailers start investing in their technology again, Sparrow explains.

He is confident the company's forays offshore will grow the group to double its size in the next five years, if the global economy stabilises and investment starts happening again. “If I'm very optimistic, it will be very easy to grow to double the size of SA.”

At the moment, international revenue only accounts for between 5% and 10% of the group's overall income. UCS is also partnering with its current retail clients to grow into Africa, he says.

The company's shares were unchanged this morning at R1.75.

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