Optima hit with $30m revenue drop

Optima hit with $30m revenue drop

Australia's largest PC builder, Optima, has seen revenues drop by $32 million to $93.8 million for the year to June 30. It made a loss of more than $1 million compared to net profits of $1.1 million in the previous financial year.

Chairman and managing director, Cornel Ung, blamed the tumble on the rapid decline of average PC prices and aggressive multinational competition.

This had seen Optima's mass merchant business stagnate, he said. About 25 per cent of the vendor's overall sales come from retailers. Another quarter is derived through traditional resellers.

"We made a decision to not focus on supplying product to the mass merchants because the profits aren't there," Ung said.

Optima also experienced a slow year in the education and government sectors. Ung said the NSW Government's shift to more centralised procurement was an ongoing factor behind smaller government school sales. The Department of Education and Training is Optima's largest customer in NSW.

Despite fewer PC rollouts, he said Optima still increased its gross profit margin by offering a broader range of desktop management services.

Ung said overall services revenue climbed by 30 per cent compared to the previous financial year. At $2.4 million, services still represented less than 3 per cent of total earnings.

He predicted revenues would improve as a result of its recently signed contracts with the ACT Department of Education and Training and the NSW Roads and Traffic Authority.

For more on this story, check out this week's edition of ARN.

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