Legend back in black
- 27 February, 2009 11:15
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Legend Corporation has reported a net profit of $3.13 million in the six months to December 31
ASX-listed IT components manufacturer and distributor, Legend Corporation (ASX: LGD), has gone back into the black, reporting a net profit of $3.13 million in the six months to December 31.
The company also reduced its debts from $34.09 million to $24.46 million. However, revenues were down $15.6 million.
CEO, Bradley Dowe, put the result down to the quality of earnings.
“We changed our strategy two years back and decided to focus on more specialised product lines and having a very wide range of products. That diversity has been our strength,” he said. “We’ve given away revenue but have swapped that for much higher margins off a smaller revenue base and that’s clearly been a sound decision.
“We’re happy to report that our funding supply is secure. We put in stock control and we decreased our inventory during the period and the profitable operation of the business generated cash in its own right. It’s been a combination of those things that allowed us to pay off our debt bankers.”
Dowe said the company's largest growth unit in terms of gross profit, was its classic Legend Performance Technology area.
Other units such as its medical electronics, electrical and power utilities had also been successful, he said.
“From our point of view it’s going to be a repeat of the last six months in terms of our focus and that’s about improving our service delivery to our customers whilst continuing our debt reduction and our careful management of our stockholding,” Dowe said. “The focus for us has been a return to selling more specialised high margin lines. The channel has had some difficulty over the past few years and perhaps that’s going to continue in some areas.”
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