European and services growth spurs on Morse

Reseller remains positive about year 2000 business despite evidence of slump.

Morse recorded a 60 per cent rise in pre-tax profit for the year ended 30 June on the back of strong sales, demand for services bundled with hardware and software, and the expansion of the firm into Europe.

Pre-tax profit was £18.9m, up from £11.8m for the same period last year.

Turnover rose 31 per cent from £216.1m to £283.9m.

Service revenue, which is embedded in the sales price of Morse products, more than doubled, while integration services grew 67 per cent to £14m.

Morse Computers UK, the division that sells Sun Microsystems product, recorded turnover of £135.6m, up from £106.9m for the same period last year. Morse Computers Germany posted turnover of £31.3m compared with £18m last year.

Morse's Hewlett Packard division, Morse Data, accounted for 35 per cent of turnover, with the UK division generating sales of £95.8m and Germany £4m.

The CPS division, which focuses on selling hardware and software products from other vendors - including Compaq - generated sales of £13.9m compared with £6.5m in 1998.

Financial services accounted for 48 per cent of turnover. Telecoms, which grew by 103 per cent, was the fastest growing sector.

Morse Germany, which was established in 1997, increased its turnover by 96 per cent to £35.3m, while the UK operations put in a strong performance.

Morse said while it sees evidence of demand slowing because of the millennium, the slowdown will be short-lived.

Richard Lapthorne, chairman of Morse, said trading in the current financial year had started well and was in line with expectations.

"Our strategy provides us with a strong foundation for continuing growth," he added.