IT Capital tightens belt

The company, which disappointed the market with its recent loss-making investment in Australian B2B business Streamlink, has engaged Sydney-based investment bank, Gresham Partners, to explore strategic options.

CEO, Jeff Dittus, says the goal right now is to lower operating expenses and increase assets under management. He says technology is a cash hungry business and ITC needs to be well positioned to support its portfolio companies.

"As the operating environment for venture capital and technology companies continues to show no sign of improvement, we have taken immediate and stern action.

"ITC began cutting overhead costs earlier this year, reducing its staff to the minimum needed to preserve the network it has built in Australia and New Zealand, Singapore and the USA that will support the internationalisation of its portfolio businesses."

Mr Dittus says operating expenses will be reduced from $4.8 million incurred for the year ended March to an annualised $2.4 million from the end of September.

One-off severance costs incurred in making this change will be included in the half-year results to the end of September.

Mr. Dittus says it has become difficult to raise capital in the current environment, not only for investment holding companies, but also for the early stage technology companies within our portfolios.

"Therefore ITC is making every effort to conserve cash while at the same time supporting our portfolio businesses."

He says while broadly ITC's portfolio of businesses is performing well, each of the companies is in need of further capital to maintain growth, particularly internationally.

"ITC needs to continue to support these businesses, especially the highly successful Deep Video Imaging and Virtual Spectator. VS and DVI have made significant strides in achieving their business plans and are promising early stage companies that will continue to need capital to fund their globalisation."

ITC shareholders will be asked at the company's AGM next week to approve the potential issue of 100 million shares to strengthen current cash reserves of around $6 million.

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