By Phil Boeyen, ShareChat Business News Editor
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Wednesday 6th March 2002 |
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The communications services company made a net profit of $3.55 million for the year on sales of $68.7 million. The result compares to the previous year's profit of $3.01 million with $41.3 million in sales.
The reason for the big sales jump lies with the company's contracting division, which purchased three Telecom Patch contracts early last year.
"Contributions from these three contracts and a full year of contributions from GDC's other four Telecom Patch contracts, together with non-Telecom business, resulted in a more than doubling of contracting division revenues from $18.29 million to $42 million," the company reports.
However the increased sales for the year have also brought a 34% increase in trade debtors, rising to $11.8 million as at the end of December.
GDC also notes that profit margins in its contracting division were slightly lower in 2001 than the year before due to fluctuating demand as Telecom and other industry participants expanded or upgraded networks or postponed earlier plans.
Revenue from sales of telecommunications and IT systems and services rose 7% to $24.62 million although the company says the improvement would have been greater "but for the events of September 11, which resulted in a number of customers deferring or reversing decisions to purchase or upgrade systems."
GDC says one of the key features for the year was a further $700,000 of capital expenditure and $2.9 million of development expenditure on its application service provider business, iVASP.
The service, which was touted in the company's April 2000 prospectus, offers operating leases to customers for computer, internet and telephony hardware and services and has now received ISO 9001 accreditation.
"Customer demand for the iVASP service grew steadily through the second half of 2001 and this growth has continued into 2002.
"As soon as iVASP business levels provide a material contribution to group performance, it is intended that iVASP will be reported on as a separate third operating division."
Looking ahead GDC directors are anticipating that the levels of capital and development expenditure on iVASP will be lower than in recent years and that high levels of performance will begin to be achieved by the new service.
They are also picking continuing improvements in performance by the other divisions.
Despite the jump in both sales and profit the company is holding its final dividend at 1.75 cent per share, representing 35.8% of net profit after tax.
The company says this is below its traditional 40% distribution level and the additional retained funds will be spent on further developing its iVASP service.
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