UXC Achieves Record Result - Again
Growth momentum continues with organic growth, strategic acquisitions and major contract wins - 23 August 2007
UXC (ASX: UXC), leading Australian technology services company, today announced a record annual profit of $24.5 million for the financial year ending June 30, 2007 - a 48 per cent increase on the previous year.
“I am pleased to announce another record result for UXC. The results reflect the successful application of UXC’s business model that targets market leadership in the areas where we compete,” said Geoff Lord, Executive Chairman UXC Limited.
“UXC’s extended track record of attaining organic growth and successfully completing strategic acquisitions, coupled with a favourable macro-economic environment, continues to deliver results and drive shareholder value,” he said.
Mr Lord continued “We are currently benefiting from three ‘sweet spots’ within which our activities are being conducted.
First, the continuing trend towards selective sourcing coupled with strong IT spend dynamics in the IT sector;
Second, infrastructure spend programs in power, water, roads and transport announced and/or planned by utilities and state governments that have revitalised the industry where our Field Solutions are offered;
And third, the rapid growth in demand for environmental solutions as well as expected support for these services from state government initiatives.”
This helped push earnings per share (EPS) up by 37 per cent to 13.73 cents, and increase EBITDA by 43 percent to $42.4 million.
The Directors have declared a final dividend of 5.5 cents per share fully franked to be paid on 19 October 2007. This brings the full year payment to 9 cents per share, an increase of 38 per cent. “The decision to increase dividends reflects the Board’s confidence that UXC has the right business mix and strategies to deliver long term growth and earnings,” said Mr Lord.
UXC Limited
Full Year |
2007 |
2006 |
2005 |
Sales |
456,943 |
300,704 |
242,621 |
EBITDAC |
48,372 |
34,841 |
29,171 |
Net Profit |
24,524 |
16,595 |
14,367 |
EPS |
13.73 |
10.03 |
9.34 |
Dividend* |
9.0 |
6.5 |
5.5 |
*Final Dividend of 5.5 cents per share payable 19 October 2007
“The outlook for UXC continues to be positive. We expect revenue from existing businesses to be well in excess of $500 million in FY08. UXC will continue its strategic acquisition of businesses with an existing or potential market leading position and we have allocated $40 million in capital spend for FY08,” said Mr Lord.
“Looking back, we have roughly doubled the after tax profit every two years since FY03. Looking forward, we plan for continued strong performance,” he said.
Strong organic growth and strategic acquisitions
Organic growth was strong across UXC with 72 per cent of the $13.5 million growth in EBITDAC contributed by existing business units.
A number of initiatives were introduced in FY07 that contributed to the strong organic growth including the launch of UXC Management Consulting, UXC Performance Management and the Enviro Saver Program.
“Clients increasingly look to UXC to provide multiple, integrated solutions. These initiatives have increased UXC’s ability to meet market demand for, and deliver high-quality and comprehensive solutions. The result is larger engagements, increased volumes and an ability to win a greater share of our customer’s business,” he said.
Organic growth was supplemented by strategic acquisitions. In FY07 UXC acquired Icon Communications, Jigsaw Services and Agave Software within its Business Solutions Group. UXC also acquired Infrastructure Constructions, Trenchless, CVM and Vision Energy in its Field Solutions Group.
Major Contract Wins
In FY07, UXC was successful in winning a number of major, high profile contracts with top tier customers, including:
- Department of Foreign Affairs and Trade – Information Systems Contract and Voice System Upgrade
- Department of Health and Ageing – Pharmaceutical Benefits Scheme
- Department of Defence – PMKeyS Human Resources Environment and Headquarters Joint Operations Centre
- Queensland Local Government Infrastructure Services - WaterWise Water Efficiency Retro-fit Program
- Energy Australia – underground distribution works Sydney metropolitan area
- Western Power – Pole Reinforcement contract
- Alinta Asset Management – Meter Reading contract
The value of these contracts is some $175m.