By Phil Boeyen, ShareChat Business News Editor
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Friday 14th December 2001 |
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For the six months ended September IT Capital lost $5.95 million compared to the last year's profit of $4.85 million. Last year's result reflected gains from selling the company's share of exo-net to Australian tech firm Solution 6.
In the latest financial period ITC says it invested $5.38 million into its Deep Video Imaging, Virtual Spectator and Terabyte Interactive businesses as well as implementing a cost-reduction programme.
Chairman, John Robertson, says the company's focus has been on reducing costs and increasing the value of the investment portfolio in a tight market.
"This course of action has been necessary because the business environment in which the company operates today is very different to that of a year and two years ago.
"Venture capital is much more difficult to secure and the valuations that are being placed on early stage technology companies are much lower than we have seen for some time."
The company has now invested a total of $3.86 million in Deep Video Imaging and $6.37 million in Virtual Spectator and Mr Robertson is continuing to tout their upside potential despite what he says are "high risks."
"We are monitoring them carefully in order to ensure that they remain focussed as they invest our scarce resources into technology development and marketing."
In October US-based CEO, Jeff Dittus, stood aside after the company terminated his contract and Mr Robertson estimates that cutting out direct US representation will save some $1 million a year.
Despite his departure from the top job over two months ago Mr Dittus' face has continued to grace the company's website as Chief Executive Officer - a sad indictment on a company which promotes itself as a venture catalyst.
Mr Dittus also resigned from the board earlier this month and phone messages to ITC management two weeks ago to discuss his departure remain unreturned.
John Robertson says the company's restructuring has cost $500,000, while the half-year result also includes losses of $936,000 from DVI and $176,000 from Golden Orb Technologies.
An $824,000 loss reported by wholly owned subsidiary, Terabyte, has also been consolidated into the company's accounts and a further $150,000 of goodwill has been amortised.
"Terabyte continues to operate in a difficult market, but is recovering from the business conditions of the past 18 months which were the most testing the company has ever faced," Mr Robertson says.
The half-year also includes a write-off of $1.274 million from the company's disastrous investment in Sydney-based Streamlink which we into administration just three months after ITC made its investment.
At the end of September IT Capital had net assets of $16.55 million compared with $33.6 million last year.
John Robertson says following restructuring the company is continuing to look to raise further capital and while discussions are continuing with a number of potential investors he notes it is too early to forecast whether these prospects will bring capital into the company.
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