By Ron Coates, 7 June 2004 16:55
NEWS Dot-com veteran Netstore scraped into its first profit ever in its first quarter this year.
The eight-year-old company turned in a £100,000 profit for the quarter and reported a turnover that was up 26 per cent on the same period last year, at £5m. At the same time it announced an extension to its contract at Essex County Council, worth £6.2m over eight years.
Sugi Sugunasingha, Netstore CFO, said: "It is our maiden profit. We have just finished our major contract with Hackney council, which was on time and on budget and that shows the market that we have the project management skills. The contract at Essex is a significant extension."
Hackney Council, once almost in chaos, has been the graveyard of several IT companies' reputations. That deal is worth £6.5m for a five-year managed service, with Netstore effectively acting as a project manager for the initial installation of financial, cash-management and business-intelligence systems from other suppliers.
The Essex County contract is a partnership with BT Syntegra. Its extension sees the number of users jump from 300 to 500 and the addition of a business-intelligence system.
Netstore was launched on the stock exchange in 2000 for a then modest £40m into the trendy ASP (application service provider) market. Currently, between 50 and 60 per cent of company revenues come from managed services.
The company has flirted with moving into profit for almost a year but various minor acquisitions and disposals have put off the day. It still has £10m in cash.
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