News blog
Eleco
- BY: Andrew Hore |
- POSTED: 01/03/2011 |
Eleco is changing its strategy in order to place more focus on its construction software operations.
Exposure to building products and precast concrete will be reduced in order to cut working capital needs. The building products business was marginally profitable in the six months to December 2010 and the precast concrete business continued to lose money. Precast contract will continue to be loss-making until four large accommodation contracts are completed at the end of June.
In contrast, software revenues and profit grew strongly. However, software has underperformed and lost money in some of the past years. Lubekonsult AB, the Swedish ventilation software and estimating business, was bought for £393,000 in 2010. All software businesses are profitable and the total contribution increased from £263,000 to £711,000.
Overall revenues dipped from £32.5m to £31.8m. This helped to reduce the loss Group admin costs were more than 10% lower than in the second half of the previous financial year. The underlying loss was flat at £1.3m.
Net debt was £6.03m at the end of December 2010, up from £2.28m at the end of June 2010. The pension deficit has fallen from £8.3m to £9.8m and Eleco hopes to reduce liabilities through changes to the scheme.
The accounting date is being changed to the end of December so the next audited figures will be for 18 months to December 2011.
At 22p a share, up 2p, Eleco is valued at £13.3m.
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