Bytes Technology on the prowl for empowerment part
Bytes Technology on the prowl for empowerment partner
October 3, 2003
By Samantha Enslin
Durban - Bytes Technology Group, which reported a 4.8 percent rise in headline earnings a share to 24.67c for the six months to August, plans to tie up with a black empowerment partner in the next six to 12 months.
Bill Venter, the chairman of Altron, who has been appointed non-executive chairman of Bytes Technology, said it was the group's strategic intent to introduce a major black empowerment partner with a significant equity holding.
"There is little doubt that further consolidations in the South African information technology industry are inevitable and the Bytes board continues to examine opportunities in this area."
Altron has a 54 percent stake in Bytes Technology.
David Redshaw, the chief executive of Bytes, said it was "in talks with two parties, with which we are negotiating an equity interest of 25 percent or more".
Revenue in the six months dipped to R1.3 billion from R1.7 billion previously and attributable earnings stood at a R28.5 million loss from a R2.6 million profit.
Redshaw said the fall in attributable earnings was due to a R66 million write-down in goodwill because of the purchase of Plato and Xerox.
The company's UK operations dampened the group's overall performance but the performance by the African operations was encouraging, the group said.
Local revenue rose 9 percent and elsewhere in Africa it rose 15 percent. In contrast, revenue in the UK dropped 61 percent.
Operating profit declined 2.4 percent to R77 million because of a downturn in the performance from the UK operations, which showed a drop in revenue of about R515 million, resulting in an overall drop in revenue for the group of 25 percent.
Redshaw said:
"A large part of this fall was foreseen because of the change by Microsoft in licence billing procedures and the adverse trading environment."
The stock closed 5c lower at R3.95 in Johannesburg yesterday.
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