ARN Powerlan, Solution 6, Spike

Powerlan's big bucks

Powerlan has announced an operating profit after tax of close to $10 million for the 12 months to 30 June, 2000.

Operating revenue for the period was $178.2 million, more than twice the expected revenue the Powerlan prospectus forecast for the period ($85.7 million).

This week, KPMG named Powerlan the best performing Internet stock on the ASX, comparing its 600 per cent in stock value gains favourably to the crashed stock prices of other Internet players that went public during the last financial year. The secret, according to Powerlan's chief financial officer Chris Voudikis, is to focus on profitability over growth from the outset.

"Frankly, the policy of Powerlan is that we will not sacrifice earnings in pursuit of revenues," Voukidis said, highlighting that Powerlan had been a solid private company for several years before going public.

Solution 6 buys into UK

Solution 6 has purchased yet another software firm, this time securing a distribution channel into the UK with the purchase of Management Information Centres Limited (MICL) for $16.7 million.

MICL provides software and service solutions to chartered accountants in the UK. It is also the sole owner of accounting software specialist Viztopia.

The acquisition gives Solution 6 access to a UK distribution channel, enabling it to sell its own solutions along with MICL and Viztopia products which are already popular in the UK market.

"It's quite a good opportunity to buy both a distribution channel in the UK and their market share," said Neil Gamble, CEO of Solution 6, who also said that he does not intend to sell the UK-based products on the Australian market.

Spike discloses loss

Spike Networks has announced a loss of $26.87 million for the year to 30 June 2000, after securities watchdog ASIC warned the company of its obligation to disclose financial details in full.

Spike experienced a 194 per cent increase in revenues ($19.11 million) but a drastic loss in earnings. A significant amount of this loss ($15.2 million) was attributed to SpikeRadio, a multimedia music streaming venture.

Spike Network's services in Los Angeles lost a further $4.8 million and have since been closed down, with the director's report to the ASX stating that Spike did not have "the resources required to support this business in the highly competitive US market".

The directors of Spike Networks have not included any forecasts for future revenue or earnings, stating that "it would be likely to result in unreasonable prejudice to the consolidated entity".