SMS announces profit increase

SMS announces profit increase

Melbourne integrator experiences 17 per cent net profit increase from June to December 2008 but cuts more than 165 staff

SMS Management and Technology has posted a 17 per cent net profit increase

SMS Management and Technology has posted a 17 per cent net profit increase

ASX-listed integrator, SMS Management and Technology (ASX: SMX), has posted a 17 per cent net profit increase, reaching $12.1 million in the six months leading to December 31.

The Melbourne-based integrator also recorded a debt-free half-yearly result with an increase in cash holdings to $20 million and $128 million in new contracts over the last six months.

According to a statement to the ASX, it has re-jigged a five-year plan to include short-term measures aimed at reducing fixed and operating costs by $5 million during the third quarter.

The integrator will also defer investments, concentrate resources on service delivery and client relationships, and proceed cautiously with recruitment. The company has also reduced its headcount to 1234 since the end of June last year, down from 1401 after adding 221 in the 07/08 financial year.

In the long-term, the company would continue to expand its managed services and systems integration offering, the statement said.

It also flagged a flat market over the next 12 months with some major project delays in areas such as core banking system replacements and the national broadband network (NBN).

SMS’ results comes on the back of Oakton announcing it had cut 90 staff and experienced a dramatic drop in net profits and CSG bucking the trend with a strong financial result.

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