DWS revenue and profit tumble in first half

DWS revenue and profit tumble in first half

Failed joint venture with Borealis impacts bottom line

ASX-listed IT services company, DWS (ASX: DWS) has experienced a two per cent decrease in revenue to $46.7 million and 24 per cent net profit decrease to $5.1 million in the first half of the 2015 financial year ending December 31.

In a statement to the ASX, DWS said NPAT was affected by one-off write down of its joint venture investment with Canadian-based software company, Borealis.

Revenue performance was down due to reduced expenditure by key customers in Victoria in July and August, and subdued general trading conditions.

The company also reduced its headcount in Victoria, Queensland and ACT, but offset that with new hires in NSW, South Australia and Western Australia.

DWS stated management changes and the addition of new business development resources in NSW, South Australia and Western Australia delivered an improved first half performance on the back of demand for its Business Intelligence, Cloud Services and Digital offerings.

The company has also added senior sales and business development resources in Victoria to focus on higher value solution based engagements.

DWS is forging ahead with its growth strategy through key investments in proprietary products, IP-based services, expanding its managed services and industry partnerships. It is also on the lookout for acquisitions in areas such business intelligence, cloud solutions and mobility.

The company anticipates economic conditions will remain subdued for the remainder of the 2015 financial year, continuing with its strategic transformation plan aimed at delivering sustainable shareholder returns in the future and will also launch its new Cloud manager product.

DWS' joint venture with Borealis went sour after Borealis failing to pay the money it owed to the joint venture, attributing the financial impact of the Ebola virus on its software projects in mine sites in West Africa. The joint venture entity will apply to wind up the Australian subsidiary of Borealis and will work with the liquidator to recover monies owed.

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