itX pulls in record profit

ASX-listed distributor posts positive result for the full financial year

ASX-listed distributor, itX (ASX:ITX), has posted record after tax profits of $7.6 million for the year to June 30 for an increase of 5.7 per cent.

In a statement to the ASX, the distributor said it finished the year debt-free with $10.02 million of cash on hand. Revenues increased by 35.8 per cent to $146.6 million, up from $107.9 million in the previous financial year.

Managing director, Laurie Sellers, said while the economic downturn had meant the distribution side of the business had contributed 4.4 per cent less earnings compared to a year earlier, the result was still pleasing.

“I’m pleased to say the decline in hardware sales was a lot less than the upside in software sales,” he told ARN. “We had good growth in the top line.”

The distributor added 34.7 per cent growth on the software side despite margins suffering due to currency fluctuations. Sellers added the virtualisation trend helped boost the distie’s performance.

“It was a combination of things. One big factor was having our first full year of distributing VMware, which went extremely well both in terms of the market for them and our ability to attract market share,” he said. “Underlying that, even though some organisations were watching their expenditure on hardware, other organisations also continued with software projects because, ultimately, it is going to result in productivity gains for them.”

While itX’s mobile resource management section of the business had under-performed and was subsequently closed down during the financial year, the acquisition of Briell Marketing added $2 million to earnings.

In late June, itX was unperturbed by IDC figures that showed significant declines in hardware sales. However, it held a $1 million stock clearance in a bid to push Sun products out the door before end of financial year while the vendor also slashed prices.