LONDON (Thomson Financial) - Tech company Bond International Software Plc.
said pretax profits dropped during the first half due to the economic downturn in its major markets but added that its underlying performance has been good and that longer-term prospects remain bright.
The company also said a transition of its sales model has had an adverse effect on current margins and will likely hold back profit in the short-term.
However, it said the new system will prove greatly beneficial in the mid-to-long term, hugely improving forward visibility of earnings and significantly increasing margins.
Pretax profits for the six months to end-June came in at 1.5 million pounds, down from 2 million last year. Sales rose 10 percent to 15.3 million pounds, helped by a brisk 20 percent rise in recurring revenues.
Bond International said the business environment for the rest of 2008 will clearly be challenging, especially as it has started to see the first signs of caution from prospective customers in Europe and the U.S. but added that it is confident about the group's prospects for 2009 and beyond.
'...recurring income together with the current order book give us better visibility than we have ever had in the past and we also have a healthy pipeline with a number of significant sales prospects,' chairman Martin Baldwin said.
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