Amortisation of goodwill on the acquisition of Plato has seen Bytes Technology Group record an attributable loss of R28.5 million for the six months to 31 August.
<B>Salient figures</B>
Bytes Technology Group results for the six months to 31 August 2003.
Year-earlier figures in parentheses:
Revenue: R1.32b (R1.77b)
Operating profit: R77.15m (R79.03m)
Profit before tax: R3.18m (R49.46m)
Attributable profit: -R28.47m (R2.67m)
EPS: -18.71c (1.77c)
HEPS: 24.67c (23.55c)
Current assets: R828.76m (R1.19b)
Bank and cash: R190.84m (R319.63m)
Current liabilities: R664.63m (R932.75m)
NAV per share: 315.07c (319.12c)
Cash generated by operations: R101.03m (R100.68m)
Cash generated by operating activities: R79.29m (R170.44m)
Revenue declined by 25.2% to R1.32 billion from R1.77 billion for the same period the previous year. CEO David Redshaw says this, as well as the 2.4% drop in operating profit, was due mainly to a downturn in the UK operations.
Redshaw says a large part of the revenue decline in the UK was foreseen due to Microsoft`s change in licence billing procedures, and the adverse trading environment.
"Excluding abnormal revenues generated by Bytes UK during the first half of last year, the group`s total first-half revenues increased 11% from R1.26 billion to R1.4 billion," he says.
Recently acquired Plato incurred an operating loss of R9 million. Redshaw says actions have been taken to rectify the situation and a break-even position has been established in the operation. He envisages an improved second half.
A better than predicted performance was achieved by the South African and other African businesses with broadly based improvements recorded by most operations despite general IT market conditions remaining difficult.
Redshaw says the objectives over the next six to 12 months are to continue growing the group`s profitability and to introduce a black empowerment partner with a significant equity holding.
He says further consolidations in the local IT market are inevitable and the group continues to examine opportunities. The board is confident that headline earnings growth over the 53.51c reported in the prior year will be achieved for the full year.
The group has also announced that it has separated the role of chairman and CEO. Redshaw will continue as CEO, while Altron Group chairman Bill Venter has been appointed non-executive chairman.
Related story:
Bytes issues trading statement
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