28 November 2011 – final results

The annual results for the year to 30 September have revealed that, before exceptional items, the group has increased pre-tax profits and earnings per share to £2.34m (2010: £1.91m) and 5.5p (3.9p) respectively.  These are good results in challenging market conditions and yet there should be further progress as the company started the new financial year with a strong order book.  It also continues to introduce new products and services and these should generate more revenues from existing clients whilst also attracting new clients.  Recurring revenues from annual software licences, support and managed service contracts remain strong at 52% of total revenues providing stability of income in difficult times.  For the year to 30 September 2012, we are expecting pre-tax profits to increase to £2.8m for earnings per share of 6.2p.  We believe the shares are far too cheap and rate them a buy with a 62p price target.  BUY