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Gijima jumps back in the black

Feb 21 2012 10:26
I-Net Bridge

Johannesburg - IT company Gijima AST [JSE:GIJ] on Tuesday returned to profit, reporting diluted headline earnings per share of 3.11 cents for the six month ended December 2011 after a loss of 28.13 cents a year ago.

No dividend was declared and the resumption of payment of dividends will be reviewed by the Board in future, based on the group's trading at the time, it said.

Revenue increased by 7.5% to 1.337bn, with earnings before interest, tax, depreciation and amortisation reflecting an 83.5% at R78.2m.

The company said the Professional Services Division had an outstanding six months and recorded revenue growth of 26.3% on the previous year. A profit of R36.4m was achieved, compared to last year's reported loss of R37.7m, a positive swing of R74.1m.

The Systems Integration unit, which was particularly impacted by the Department of Home Affairs settlement last year, delivered a much improved performance and is successfully deploying some substantial projects. The ERP business also showed excellent growth, with significant new SAP project implementations during the period. The pipeline for this line of business remains healthy, it said.

The mining technical solutions business produced very strong results, with a marked improvement in the top and bottom line for the half-year.

Revenue for the Managed Services Division was marginally down, with profit down 35%. This decline is attributed to the Unified Communications, Data Centre and Security units which had a relatively muted performance due to low sales volumes.

The Distributed Computing business showed respectable top line growth and maintained relatively healthy margins through its favourable services mix and continuous optimisation drive. Gijima continues to expand its mobility offerings and, although the contribution from this area is still small at present, the group anticipates this will be an area of considerable growth going forward.

Revenue from the Industrial (mining and manufacturing) sector grew by 8.5% over the period, with growth of 6.9% to Financial Services clients and 6% in Public Services.

Looking ahead, Gijima said compound annual growth rates of up to 9.5% are predicted for the ICT services market through to 2015, compared to the 8.5% growth experienced over the last year.

Maintain, Support and Upgrade, Managed Services and Hosting services contributed significantly to this growth with 26.4%, 26.1% and 19.0% growth, respectively. The growth going forward is being driven by an increasing optimisation drive across the economy, prompting the outsourcing of non-core IT activities with the view to drive down cost.

"The convergence of IT and Telecoms, along with the rapid upgrades and refreshing of technology, is also driving the IT growth. The mobility wave should not be ignored, which is also being heavily influenced by executives adoption along with Bring Your Own Device philosophies being increasingly adopted across enterprise," it said.

Gijima's organisational restructure has been completed, with phase two commencing in the second half of the year. This will focus on creating an organisation that aligns with the core competencies required to deliver on Gijima's objectives and vision.

"Gijima is building a strong mobility capability, which is supported by the recent announcement of its Apple System's integration partnership, along with its relationship with MobileIron, a mobile device management company. These relationships along with internal development of mobility offerings will ensure that Gijima establishes a strong presence in the market where it concerns mobility offerings for enterprise," it concluded. 

gijima ast


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