Allied Technologies has begun a fresh round of discussions with several potential buyers to sell the business. The announcement comes after the services company reported a marked improvement in its financials, chalking up a positive net result for the first six months to December 31, 2005.
The company recorded a net profit of $1.2 million, representing a rise of $2.5 million compared to the corresponding period last year.
The result is largely thanks to the sale of its TUSC Computer Systems division, which contributed $1.4 million in net profit.
The telecoms and utility subsidiary was sold to Ericsson in November for $9.5 million.
This sum was $2.8 million higher than that paid by Allied 12 months ago.
Even without the sale, Allied's profit column improved considerably, rising from a $1.5 million loss in the six months to December 2004, to a $270,000 loss for the first half of this year.
Chairman and managing director, Michael Addison, said the lift was the result of its rationalisation program and reduction of fixed overheads. This included cuts to its senior management layer, he said.
However, revenues between corresponding periods decreased by 7.9 per cent, or from $12.4 million to $11.4 million. In an ASX statement, the company said the higher 2004 figure was due to two large infrastructure contracts which had not been replicated this year.
The next step was to confirm a new buyer for Allied, Addison said.
The company struck a reverse takeover deal with building services company, ARA Group, in January, but terminated the agreement this month.
At the time, he claimed it was mutual decision to cancel the deal.
The company is now investigating several alternative offers. Addison hoped to confirm a sale within the next six months.
"ARA wasn't the only game in town," he said. "We have identified other opportunities and are going down one of these roads."