ASX-listed distributor, itX (ASX: ITX), has recorded a debt free and solid half-yearly profit of $4.41 million despite the ailing economy in the six months leading to December 31.
The result was 8.2 per cent lower than last year’s $4.8 million effort, but the distributor’s revenue improved by 34 per cent to $67.5 million, with $6.4 million net cash in hand.
Managing director, Laurie Sellers, said its distribution relationship with VMware and virtualisation portfolio helped contribute towards the growth.
“We’ve seen very good growth in IBM, Citrix as well as a couple of other products that we took on such Vizioncore and DataCore,” he said.
Sellers acknowledged, however, that it had experienced a tough trading period with hardware sales.
“Overall hardware has been a tougher road, but because we’re in software distribution, it worked a bit better for us,” he said. “But hardware sales weren’t significantly down, it just was a bit tougher, and I think that was driven by organisations being a bit more careful in terms of capital expenditure and delaying projects until they get comfortable with what’s happening in the economy.”
To help contain costs, itX restructured its NeXos unit and enforced cost saving initiatives.
“The plan is to keep a really close eye on costs as we continue to build the business,” he said. “I don’t want to do anything that’s going to inhibit growth, but I want to be sensible about managing costs because things are less certain at the moment.”
Sellers remained optimistic about the second half of year and pointed to less fluctuation in exchange rates and new government tenders as positives.
“Federal government is starting to release tenders out that they’ve been sitting on for a while and we’ve seen activity among the reseller base,” he said. “I think we can afford to be a bit optimistic about the second half.”