UK systems integrator and IT consultancy Logica Plc has reported net profit for the financial year to June 30, 1999 up 33% at 39.8m pounds ($64.5m) on revenue that rose 39% to 659.5m pounds ($1,069m). At the pre-tax level, the London-based company said profit was up 40% to 58.6m pounds ($95.0m), taking into account goodwill amortization of 4.8m pounds ($7.8m). Earnings per share rose 45% in the year, to 12.3 pence ($0.20).
Logica’s telecoms business saw the most rapid growth, expanding 81% to 203.1m pounds ($329.3m). These figures include those for Logica Aldiscon, the company’s Dublin, Ireland-based mobile telecoms software specialist, acquired in 1997. Logica Aldiscon revenue grew 129% to 94.3m pounds ($152.6m) in the year. Telecoms growth was mainly due to demand for Logica’s repeatable non-voice messaging, pre-paid calling and customer care and billing solutions, according to Mario Anid, Logica’s Corporate Development Director.
Logica’s concentration on the telecoms market impacted on its finance business which grew less dramatically, up 18% to 151.1m pounds ($245.0m), as a result of Logica avoiding competitive tendering. However, the company’s industry, distribution and transport and public sector interests both grew substantially, up 49% at 116.5m pounds ($188.9m) and up 26% to 82.0m pounds ($132.9m) respectively. The relatively slow growth in its energy and utilities business, which grew 19% to 106.8m pounds ($173.1m), was attributed to the slowness of deregulation in the US market.
Geographically, the UK and Ireland remained Logica’s largest market accounting for 283.0m pounds ($458.8m) in revenue following growth of 23%. Continental Europe made up 195.2m pounds ($316.5m) of revenue, up 54%, ahead of North America up 38% to 67.9m pounds ($110.1m). Anid said the more rapid growth in these two territories was due to Logica’s decision to build them up, giving it a three legged strategy. Asia Pacific/Middle East, however, experienced a 24% fall in revenue to 19.1m pounds ($31.0m) reportedly because of difficult economic conditions.
Although figures were not published, Anid said that about 15% of Logica’s total revenue was attributable to consulting services, with business process work and applications management making up 20%. The company’s traditional application and systems integration work accounted for the outstanding 65%.
Because of its announcement immediately before Logica’s year end, the purchase of UK-based SAP implementer Team 121 (CI No 3,690) has yet to make an impact on Logica’s figures. Logica reiterated its intention to make further acquisitions to fuel its international growth with finance and utilities singled out by Anid for expansion. Amortization of goodwill related to previous purchases is expected to reach around 11m pounds ($17.8m) next year with a total of 191m pounds ($309.6m) currently outstanding.
