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LONDON (Alliance News) - Vianet Group PLC Thursday expressed confidence in its long-term strategy, although it cautioned that trading in the UK pub sector will likely remain challenging, as revenue growth and cost-cutting measures helped it to post a small rise in pretax profit for its recently ended financial year.
Vianet provides monitoring systems and data management services for the leisure, vending and forecourt sectors.
In the year to end-March, the company posted a pretax profit of GBP1.7 million, up from GBP1.6 million a year before, as a rise in revenue to GBP18.6 million from GBP18.3 million and lower administrative costs helped offset exceptional costs of GBP600,000 related to restructuring and cost cutting measures.
The company highlighted uncertainty in the pub industry during 2014 as a result of the UK government introducing a new statutory code for pub companies, which has hit sales of its iDraught product. Vianet said it regarded the proposed statutory code was a "fair outcome" and greeted it with cautious optimism. Although there might be a limited long-term hit, Vianet said, this uncertainty held back further investment and led to increased pub disposals and closures.
It did not lose any contracts, but loss almost 900 beer monitoring installations at a time when it was starting to see a pick-up in trading, it said.
Vianet expects trading in the pub sector to remain challenging, and cautioned that its growth and profitability remains strongly influenced by external factors such as legislative, socio-economic or corporate activities in the UK pub sector.
However, it said it had continued to make good progress with its other markets. It saw good progress in its vending solutions business. In its Vianet Fuel Solutions business, revenue was broadly flat, as growth was held back by projects being delayed into 2016.
"The board remains confident that Vianet's long-term strategy is appropriate, that the group is well positioned, within the parameters of its influence, to deliver sustained earnings growth, which in doing so should also expand the future strategic options for Vianet," said Chairman James Dickson in a statement.
The company proposed a final dividend of 4.00 pence, taking its total dividend for the year to 5.70 pence, unchanged from the previous year.
Shares in Vianet are trading flat at 102.00p Thursday morning.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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