RMG positive despite wider loss

Last month RMG reported a full year loss of A$4.037 million for the 2000 year but this has increased to A$5.4 million.

The company says the final figure includes an abnormal charge of A$1.129 million due to an unreconciled amount in its operating bank account.

RMG says the charge has arisen out trying to account for the assets and business of 22 receivables management entities in Australia and New Zealand during the year.

"The acquisition of these entities was structured such that the vendors of the entities ran the businesses on behalf of the company for a period following acquisition," the company says in its annual report.

"In some cases it has not been possible to obtain full accounting records for this period. The task of integrating the business processes, management structures, financial controls and financial reporting regimes has been complex and lengthy."

The company has also charged a further $800,000 for potential items arising out of the creation of the business.

Managing director, Paul Cooney, says he is pleased that the company now had a more solid balance sheet.

"Integration costs were higher and the process took longer than expected but bringing so many companies together has been a remarkably difficult, costly and time consuming process.

"Sales revenue for the period was very encouraging and we are confident that the business processes and management structures now in place are appropriate for the delivery of revenue and improved profits which will ensure growth in the immediate future."

The new figures show the company had a positive trading result of A$647,000.

Paul Cooney says the full benefit of the six business acquired during the last half of 2000 will bear fruit in the 2001 results and growth in the second half will also come from new contracts won in the telecommunications, utilities, and banking and finance sectors.

"In addition, we are continuing to experience growth in outsourcing assignments which are providing high volumes both in Australia and New Zealand at a faster rate than expected."

Mr Cooney says the first quarter of the current financial year has shown improved profitability.

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