6pm is reaping the benefits of its decision to focus on solutions rather than the sale of products to third parties, since this provides a long-term annuity.
“In the past, our revenue was derived from the sale of licences along with maintenance contracts, but the provision of solutions has widened this to ensure that we get much more repetitive business, with £0.9 million so far this year, due to reach £1.8 million by the end of this year, and forecast to grow to £3 million in the next financial year,” CEO Ivan Bartolo said.
The group has just reported a profit of £245,000 for the first six months of the year, up from £180,000 for the same period last year.
6pm is now looking at a further innov-ation which it believes is a natural progression on this business model: leasing.
“This is a completely new concept which goes well beyond outsourcing,” he said, likening it to a car lease agreement.
“We would buy the hardware and lease it out to an entity, state or private, for a number of years. This has a number of advantages for them. Some are obvious, for example, they save on the capital expenditure and the depreciation. The lease cost is also tax-recognised.
“But there are others. Most companies with an IT system have a system administrator but most of them work at just 40 per cent productivity, according to surveys. And with complex IT systems, it simply does not make sense for a company to try to employ people with the IT skills required to run all the software and hardware – whereas we have economies of scale so we can make very interesting leasing proposals,” he said.
The group continues to make inroads into the UK National Health Service (NHS) sector, securing a contract in excess of £2 million with St George’s Trust in London to deliver a system incorporating Electronic Document Management and the newly-implemented Intelligent File and Inventory Tracking (iFIT) system. It is projected that the solution will be delivered by the end of the year.
The company’s success has brought with it considerable expansion over the years and its 150 staff were spread across six locations. It will now move them all under one roof in Swatar at the end of September. “This will definitely increase our productivity and the synergy among the different units,” he said, noting that it would also foster more of a brand culture.
The 2,000 sq.m. 6pm Business Centre will absorb the company’s spare cash – as a result of which no interim dividend is being recommended. However, Mr Bartolo said he was very confident that the board would recommend a final dividend.
vanessa.macdonald@timesofmalta.com
At a glance
Financial period January 1, 2013 – June 30, 2013.
Profit before tax: £245,087 (2012: £180,046).
Revenue: £4.5 million (2012: £3.9m)
Cost of sales: £2.9 million (2012: 2.6m)
Earnings per share: £0.0.13 (2012L £0.01)