Zaptronix has turned in a stronger income statement for the six months to October, thanks to a change in the company`s focus.
Revenue of R889 000 was down 43.8% from the R1.56 million of the same period the previous year. However, recently appointed CEO Jan Nel says this was expected.
"The interim results for the six months ended 31 October 2004 reflect the initial impact of concentrating on the electricity metering products while shifting focus towards remote metering solutions," he says.
He says although the decision led to an expected decrease in revenue, it had improved margins and returned the group to profitability, though the profit was still marginal.
An operating profit of R49 000 compares with a year-earlier loss of R273 000. Pre-tax income rose from a R244 000 loss to a positive R49 000. Profit after tax was R34 000 (2003: R244 000 loss).
The group achieved earnings and headline earnings per share of 0.02c (0.17c loss per share). The cash flow statement shows cash of R761 000 (R19 000) utilised in operations.
At the end of the period Zaptronix recorded a net asset value of 0.14c a share (1.44c) and a net tangible asset value of -0.08c a share (0.32c).
"The company has now established its technology and service infrastructure to support its new extended strategy of adopting a service-based revenue model," says Nel. "Leveraging against the existing base of providing energy management products and solutions, the new revenue model also focuses on generating annuity income.
"This is consistent with the operating strategy of positioning the company as a technology-driven information hub, providing clients with services to reduce operating expenses and increase efficiencies. A detailed marketing and roll-out plan in this regard is currently under consideration."
The group is in the process of acquiring DuO Solutions Provider, a public unlisted company operating in the supply chain, logistics and fleet management and vehicle monitoring markets.
Zaptronix has applied to transfer its listing to the JSE`s alternative exchange, AltX, once that deal has been completed.
An analyst says the improvements in the company`s results are pleasing, but it is still too early to tell whether the performance is sustainable. "The year-ends will give us a better indication," he says.
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