Azlan 'on track' as half year profits jump 50%

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The Independent Online

Azlan, the network computing and services firm, said yesterday it believed trading was still "on track" as it posted a near-50 per cent jump in half year pre-tax profits.

"We'd say we're on track at the moment," Peter Bertram, the chief executive, said. But he noted that Azlan has limited order visibility and he could not comment on post-Christmas trading.

He thought Azlan's focus on small to medium-sized firms was helping it weather tough conditions as was the fact that it does not rely heavily on any specific industry sector and that none of its customers accounts for more than 2 per cent of revenues.

Mr Bertram said the company had seen strong growth in southern Europe but noted that the UK market was difficult due to the "tough economic climate". Azlan shares closed up 6 per cent at 131p.

In the six months ended 30 September, pre-tax profits came in at £8m, up from £5.4m in the same period last year, on sales of £298.3m, up from £261.7m. Earlier this month, the company had said the figures were set to outstrip market forecasts.

Azlan ended the half-year period with £6.7m of cash, but could stand to benefit from returned duty payments of some £2m after estimating it had been overpaying duty between March 1995 and December 1999.

The company's product distribution business, which resells equipment from firms such as the US giant Cisco, produced a profit of £21.9m, up from £16.2m, as sales rose 15 per cent. Profits at its services unit were flat on sales up 24 per cent. The company's training business, however, saw profits fall to £2.3m from £3.1m while the division's sales rose by just 1 per cent.

"We didn't grow [training] as anticipated at the top line," Mr Bertram said, while noting that the unit's costs had risen as more of its own staff were trained up.

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