SCH dragged into the red by one-off costs
Resell and distribution heavyweight enjoyed a "good year in difficult market conditions", despite posting a £13m loss
Rigby: we are pleased to report a positive start to our new fiscal year
One-off costs incurred from its recent exit from three European countries dragged Specialist Computer Holding (SCH) to a £13m full-year loss.
In its accounts for the year to 31 March 2009, the privately held corporate reseller and distributor said it had a “good year in difficult market conditions”, as turnover from continuing operations rose 14 per cent to £2.24bn.
SCH chairman Sir Peter Rigby, said: “Against the backdrop of one of the most challenging business environments in the group’s history, the continuing operations of the group reported a strong performance.”
However, SCH’s bottom line was hit badly by loss-making operations on the continent and one-off costs relating to their disposal or discontinuation.
The Italian and German businesses it divested in April and its discontinued Danish operation saw combined losses widen from £1.9m to £4.7m year on year. Exceptional losses stemming from their disposal stood at a hefty £12.8m, dragging SCH to a £13m post-tax loss for the period.
UK revenue grew nine per cent to £825m, primarily due to SCH’s acquisition of IBM and Sun distributor Interface Solutions last July.
Without ISI, UK revenues slipped 1.9 per cent. UK operating profit before exceptional items rose 11.5 per cent to £4.8m.
Total after-tax profit from continuing operations was £5.8m, compared with £4m a year earlier, and Rigby was upbeat about the prospects of SCH’s remaining interests.
“Each of our companies in the countries above is well placed within its respective market and we hope to build on their profitability and market share,” he said.
Rigby claimed that SCH’s balance sheet remained strong with net assets standing at £136.1m and net debt falling from £91.7m to £77.8m.
“Despite a challenging year, we believe that the group is well positioned to capitalise on the market opportunities and we are pleased to report a positive start to our new fiscal year with improvement in our operating profit for the six-month period to 30 September,” he said.
According to information issued since the accounts were filed, operating profit for the six months to 30 September came in £5.3m ahead of last year (£4.2m ahead excluding discontinued operations). SCH's core UK and French operations were particularly strong, the firm said.
Despite restructuring programmes in the UK, Spain and the Netherlands, SCH's average monthly headcount rose from 5,533 to 5,693 during the period. The highest-paid director’s salary fell from £2.1m to £1.64m.