21st Feb 2019 11:45
LONDON (Alliance News) - IDOX PLC on Thursday said it swung to a loss in its most recently ended financial year following the closure of its Digital division.
The management services provider said it swung to a pretax loss of GBP29.5 million in the 12 months to the end of October 2018 compared to GBP2.8 million reported the year before, as revenue declined by 8.6% to GBP67.4 million from GBP73.8 million.
IDOX said it saw a slight increase in gross margin to 87% from 85% as a result of cost-savings initiatives introduced throughout the year. Earnings before interest, tax, amortisation, depreciation, restructuring, acquisition, impairment, corporate finance and share option costs decreased by 13% to GBP14.4 million.
In addition, IDOX decided not to declare an annual dividend, having paid 1.04 pence the year before.
"In reaching this decision, the board has taken into account the disappointing results for the year and the ongoing efforts to transition the business to a more stable footing," explained Chair Chris Stone.
On a divisional basis, the PSS unit, which accounted for 47% of IDOX's revenue, delivered revenue of GBP34.3 million, down from GBP40.8 million the year prior.
The EIM division, which accounted for 14% of IDOX's revenue, recorded revenue of GBP10.0 million, down from GBP12.9 million a year earlier. EIM saw a fall in revenue due to an increased emphasis on software-as-a-service and managed service deals and continued pressure on per-seat licence prices.
The Health division's revenue grew to GBP9.3 million from GBP7.1 million year-on-year, while the Digital unit's revenue halved to GBP6.5 million from GBP12.7 million. In November last year, IDOX said it sold its loss-making Digital business to refocus its operations on its core profitable and cash generative activities.
"This has been a challenging year for Idox. The business has faced a number of challenges resulting from previous leadership decisions and there has been significant work to re-establish the necessary disciplines and rigour required for future success," said Chief Executive David Meaden.
Meaden was appointed as CEO in June last year upon completion of operational and financial review of the business, leading to the closure of the Digital division.
IDOX shares were trading 2.3% higher on Thursday at 30.70p each.
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