IT systems and services provider SCISYS is finding trading tough as the government and broadcast customers delay investment in software and systems.
The government and defence, applications management and environmental divisions are being merged. This will make it easier to efficiently use their resources. There were £284,000 of restructuring charges in the first half of 2013.
In the six months to June 2013, revenues improved from £19.6m to £21.4m and underlying profit edged ahead from £1.15m to £1.19m. R&D tax credits have reduced the company’s tax rate to 16%. The interim dividend is unchanged at 0.4p a share.
The order book was valued at £21.5m at the end of July. Work has already started on the Warrior armoured vehicle contract.
MakaluMedia made a full six month contribution to the Space division and was earnings enhancing. The media and broadcast division has been hit by delays in orders and the anticipated orders may not come through until next year.
A reduction in trade payables meant that SCISYS ended the first half with net debt of £2.07m.
At 69.5p a share, down 13p, SCISYS is valued at £20.2m.
House broker finnCap has reduced its 2013 profit forecast to £2.9m, compared with £2.4m in 2012.
The shares are trading at nine times prospective 2013 earnings. A full year dividend of 1.4p a share provides a yield of 2%.
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