By Phil Boeyen, ShareChat Business News Editor
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Friday 1st March 2002 |
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The loss compares to a profit of $1.36 million the year before. Sales increased to $191.43 million from $156.6 million with the benefit of a full year's ownership of Christchurch-based Insite Technology however an operating loss of $$4.17 million was recorded.
"2001 was a difficult year for Renaissance, which is reflected in disappointing financial results," the company reports.
"The New Zealand information technology market experienced the filter-down effect of the US technology recession, which meant that our expectations of a growing market did not eventuate. Both intense competition and an unfavourable climate for technology venture investment had a significant impact on our business."
Restructuring at the company, including ending non-exclusive distribution agreements with companies like Hewlett Packard, Compaq, Microsoft and Toshiba, cost the company money.
Added to this was the decision to exit the offshore offices of its Conduit e-business subsidiary and the write down of related intangible assets and goodwill.
"To illustrate the significance of this, only $100 million of our $191million turnover was attributable to activities which will continue into 2002.
The company admits that the changes to the nature and scale of its operating have been very costly in the short term but says it leaves it more able to focus on improving shareholder returns. Going forward it intends to concentrate on the distribution of products to which it can add value.
"This is most readily achieved where we have sole distribution rights and work closely with a vendor that is not directly represented in this country. Our relationship with Apple Computer provides the template for this style of operation."
The company says it will not be paying any dividends until it can demonstrate a return to profitability.
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