JSE-listed technology services company Business Connexion (BCX) has turned in a modest performance in the six months ended 28 February 2013, with normalised headline earnings per share of 24,8c from 24,5c in the same period in 2012.
Revenue grew by 8% to R2,9bn, bolstered, the company says, by good growth from most divisions.
Turnover in the services division rose by 3,4% to R981,9m, mainly because of a good performance by its application development business. The professional services business also showed good growth, particularly in the public sector, according to BCX.
However, delays in starting a number of new contracts, which will contribute to revenue in the second half, resulted in the division carrying extra costs for a number of months without corresponding revenue, affecting the bottom line.
The UCS division contributed R560,1m to group revenue, with an operating profit of R47m. The Canoa division added R514,9m to the top line, R56,9m in operating profit. Both units exceeded expectations.
Meanwhile, the technology division contributed R13,1m to operating profit from a loss of R7,7m a year ago.
The innovation division’s revenue was flat at R244,1m, but increased its contribution to operating profit by 9,3%. Revenue in the international division — the rest of Africa outside South Africa — grew by 12,1% to R239m.
BCX completed the acquisition of IT group Integr8 IT during the reporting period. This will contribute fully to the next six-month reporting period.
During the period, BCX also introduced cloud computing services in the small and medium business market, marking what it calls the start of a channel partner strategy that should become important in future.
The company also launched its first data centre services in Nigeria in February. This was a “major milestone in expanding our business on the African continent”.
BCX’s gross profit margins fell to 30,1% from 31,5% as a result of a shift in the mix of revenue between services and product sales. However, it kept a tight rein on operating expenses, with these falling by 9,5% to R730,9m.
The company’s share price has risen by 26% in the past 12 months, for a market value of R2,3bn. — (c) 2013 NewsCentral Media
