sp down

Citect's expansion helps
David Crowe
2004/08/25



Manufacturing software developer Citect yesterday reported a 7.7 per cent gain in total revenue to $28.9 million for the first half, helped by its expansion in the market for software that links manufacturing systems with business software applications.

Citect warned, though, that its expansion would add $1 million to its expenses in the second half, hurting profits.

"Given the increased expenditure, revenues are expected to grow and profit is anticipated to be higher than the first half of 2004, but lower than the second half of 2003," the company said.

Citect's profit improved in the six months to June 30 as the company cut research and development expenses to $3.7 million compared with $9.9 million in the previous corresponding period.

Net profit was $1.6 million compared with a net loss of $4.7 million.



Operating cash flow also improved, rising to $1.7 million compared with negative operating cash flow of $341,000 in 2003. The company ended the period with $4.5 million in cash.

Because the company makes most sales overseas ,the rise in the Australian dollar took its toll on the financial results.

Sales fell 22 per cent in the Americas when reported in Australian dollars, though the fall was only 4 per cent in US dollars. Sales in Europe rose 18 per cent in local currency but only 10 per cent in Australian dollars.

The company's turnaround was best illustrated by its earnings per share, which rose to 3.09¢ compared with a loss of 8.92¢ per share in the same period last year. Citect maintained its interim dividend of 2.5¢ a share.




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