The CFS Group Plc, the UK-based provider of inventory finance software, yesterday announced a successful year of acquisition-led growth resulting in preliminary net profits up 185% to the equivalent of $2.5m on revenues up 61% to $17.9m. The company made two acquisitions in 1998, spending a total of $17.9m.
The ambitious acquisition of equally-sized US company LeaseTek, a Pittsburgh, Pennsylvania firm offering lease administration software, was made in July for $16.1m, giving it CFS complete ownership of the company (CI No. 3,430). The acquisition was funded through an open share offer which raised $19m, net. And at the end of last year, CFS acquired Australian lease/loan software provider, Financial Systems of Australia Pty Ltd (FSA), for $2.4m.
The company said the two acquisitions gave it worldwide presence and the ability to cross-sell into horizontal markets. Its customer base is within the asset-based finance industry. Executive Chairman, Alfred Stein, said that the company plans to continue growth through vertical acquisitions in the coming year, adding that e-commerce was an area of particular interest. Stein said some companies were being considered but would not reveal any details.
CFS share closed the day 23.6% up at 159.5 pence on the London Stock Exchange. Figures were converted at a rate of 1.6272 dollars to the pound.
