ASX-listed Volante Group has announced a small increase in net profits for the six months ending December. But a focus on growing its services business contributed to a 20 per cent fall in hardware revenues.
The half-yearly figures detailed a rise in net profits from $3.1 million to $3.3 million on revenues of $201 million. The acquisition of Ipex early last year meant revenues were not comparable with the same period of 2003.
Announcing the results, group managing director, Ian Penman, said the growth reflected an ability to win government and corporate business in the 200- to 500-seat mid-market.
Penman, who joined Volante in October, said he had a mandate to build a services-led business.
Managed services contributed $42 million to Volante Systems' first half revenues of $196.7 million - with hardware sales totalling $107 million, and $48 million accrued through software sales.
Hardware sales were down 20 per cent, which Penman blamed on a lack of internal focus rather than external factors such as the change of government buying policy cited recently by Optima.
"The focus came off the Ipex and procurement business as we started to invest effort and time into the services business," he said.
"But we have readjusted that by appointing a sales manager for the Ipex business and we are developing a specialised sales force around him. So I think you'll see that gap in our business starting to close."
Former national education sales manager at Acer, Michael Cefai, was appointed Ipex sales manager in December.
"He will be addressing the same sort of markets as he did with them - government, education and large corporates," Penman said.
In terms of strategy for 2005 the company sees services as a way of increasing cross-selling opportunities and revenues.
"Managed services in particular provide an annuity stream, it provides a much closer engagement with the customer and gives us the opportunity to introduce professional services into the same organisation," Penman said.