P&P doubles profit to pounds 4m after change of direction

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The Independent Online
PROFITS doubled at P&P, the computer services group, in the year to 30 November following its move out of high-volume, low-margin distribution of personal computers. Pre-tax profits were pounds 4.1m in 1993, up from pounds 2m before extraordinary charges. Turnover fell slightly, to pounds 217m from pounds 223m.

During the year P&P sold two 'box-shifting' distribution businesses, its original core activity, in Britain and Belgium. The company now sells PCs and software direct and provides a one-stop supply and consultancy service to corporate customers.

David Southworth, group managing director, said: 'We have identified niches where margins are high and we are not going to get into competition with people we cannot beat.'

Consultancy is one high-margin area. Sales to large corporate clients, which include ICI, British Aerospace and Royal Bank of Scotland, expanded.

A second niche is video conferencing systems, which link desk- top PCs, telephones and a video image of the participants. P&P has supplied Northern Telecom's Visit system for the past six months. Yesterday, it announced a marketing partnership with PictureTel, the US video conferencing specialist.

'Desk-top communications are a key area of growth,' Mr Southworth said.

The recovery in P&P's profits after two difficult years had been expected and the share price closed 1p down at 82p. Analysts' forecasts for the current year range from pounds 5m to pounds 7m depending on their view of how well the video conferencing products will sell.

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