6pm Holdings plc - Full-Year Results

On 30 April, 6pm Holdings plc published its 2010 financial results. The financial statements show a 42.8% drop in revenue to GBP3.1 million mainly due to the economic slowdown in the UK economy and the uncertainty brought about by the UK general elections which postponed any IT spending by both existing and new clients. Given the decline in business activity, cost of sales dropped by 45.1% to GBP1.8 million resulting in a gross profit of GBP1.2 million compared to the 2009 gross profit figure of just over GBP2 million.

In a recent stockbrokers’ meeting, CEO Mr Ivan Bartolo explained that administrative costs cannot be reduced further as this would hinder the quality of the service provided by the Group. In fact, during 2010, administrative expenses were only reduced by 10.7% to GBP1.6 million resulting in an operating loss of GBP0.33 million in contrast to the operating profit of GBP0.28 million registered in the previous year.

After accounting for finance costs of GBP112,478 (2009: GBP126,250), the 6pm Group reported a pre-tax loss of GBP447,235 which in turn gave rise to a tax credit of GBP154,178. This tax credit reduced the loss for the year to just under GBP0.3 million.

It is important to highlight that these results also include the consolidated figures of Softweb Limited covering the four months from the time of acquisition of a 70% shareholding in October 2010. Although this recently acquired company is contributing positively towards the 6pm Group financials, the contribution is minimal as evidenced by the minority interest figure of just GBP2,429.

Given the loss for the year under review, the Directors did not recommend the payment of a dividend.

In a separate announcement, the 6pm Group announced that the rights issue of 10,788,000 New Ordinary Shares was oversubscribed. Details of the allocation policy will be announced in due course.

Download a copy of the 6pm Holdings plc – 2010 Annual Report