IT services player, DWS Advanced Business Solutions (ASX: DWS), has reported steady revenue and a debt-free balance sheet for the half-year, despite poor results across its Sydney operations.
According to its financial report, total revenue grew 1 per cent to $44.03 million. Pre-tax profits were down $2.2 million to $10.47 million. Net profits also declined by 16 per cent to $7.22 million. The results encompass DWS’ acquisition of Microsoft integrator, Strategic Data Management, 12 months ago.
CEO, Danny Wallis, said its Sydney operations were adversely affected by market stagnation, but highlighted continued growth in Melbourne, Adelaide and Brisbane. Over the past six months, DWS has shed 35 staff in Sydney and reported a 96 per cent drop in pre-tax profits to $157,000. Revenue also fell 43 per cent to $7.8 million over the same period.
However, the group increased overall staff numbers by eight to 527 over the six-month period.
“Sydney was a difficult market for us – it was a mix of different acquisitions that wasn’t performing. We have pulled it apart and are now moving in a sustainable direction in that market,” Wallis said. Growth across other regions stemmed from all segments of the market including state and Federal Government, he said.
“Government is now 20 per cent of our business – a year ago, it was 15 per cent,” Wallis said. “We have been successful with our tenders and expect to do well in the next six months.”
Wallis was confident DWS would continue to perform strongly despite the economic slowdown.
“It is a declining market, but our smaller competitors are falling off just as quick,” he said. “Available business is still there.”
Last year, DWS made a raft of management changes, including the appointment of its first chief operating officer, Vivian Clarkafter reporting lower than expected results in the third quarter of 2007/2008.