PS&C flags revenue fall after scrapping contractor management business

PS&C flags revenue fall after scrapping contractor management business

Follows the discontinuation of its "low margin" contractor management business

IT services provider, PS&C (ASX:PSZ), has flagged a 2.7 per cent year-on-year fall in revenue for the six months ending December 2017, with the company citing the discontinued its low margin contractor management business within its People segment.

PS&C, which has a strong focus on the government sector, is made up of three business units - People (technical and professional services), Security and Communications.

Regardless of its revenue fall, the publicly-listed company reported statutory net profit after tax (NPAT) for the period of $269,000 off the back of its $37.4 million revenue tally, a vast improvement from the $6 million net loss the company reported the same period in the prior year.

PS&C’s results for the six months ending 2016 were severely impacted by a reduction in long-term forecasts for the company’s Communications business segment, which resulted in a goodwill write-down of $6.85 million.

For the half-year ending 2017, the company’s earnings before interest and tax (EBIT) result showed year-on-year growth of 35 per cent.

During the period, the company made several changes to its executive team, hiring former head of global sales for Tesserent, Kurt Hansen, as the group’s security CEO. The company told shareholders that Hansen’s appointment would maximise its position in the growing security market.

In addition to Tesserent, Hansen previously worked for Cisco, Symbol Technologies, F5 Networks and CheckPoint Software. He was also a senior executive at Telstra and was the CEO of AirData.

“With mandatory data breach legislation coming into force on [22] February 2018 we anticipate accelerated growth continuing during the second half of FY18,” the company said.

At the same time, the company said it was “very pleased” with the strong contribution from its recent acquisitions of Sacon and Coroma in the areas of cloud solutions, DevOps and Salesforce consulting.

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