Vianet reports drop in profit, but looks ahead with greater confidence

Vianet Group on Tuesday reported a drop in pre-tax profit for the year ended March 31st, which it blamed in part on pub closures and uncertainty over the statutory code for pub companies. The firm, which is a real-time monitoring systems and data management provider to the services sectors reported revenue of £18.34m for the 12 months ended March 31st, compared to £21.09m a year earlier. Pre-tax profit totalled £1.6m, down from £1.8m in 2013. The number of new vending units installed rose to 2,067 compared to 475 the previous year, although new beer monitoring installations more than halved to 416. Vianet explained that it has reduced, or substantially cut, the parts of its business which are considered low growth or low margin, whilst re-calibrating its beer flow monitoring operations to mitigate against external market pressures. It had also continued to develop more solutions for its core pub industry clients.Significantly, the UK government last week published a long-awaited response to the consultation on its proposed Statutory Code for Pub Companies, the result of which is that it intends to legislate to put the existing voluntary code onto a statutory footing.Vianet said it was "pleased that the uncertainty of the past several years is now being lifted and considers this a satisfactory outcome". However, it suspects that the legislative implementation of the wider statutory code "may remain a distraction for our customers for a period of time yet".Chairman James Dickson said: "I am pleased to report that good progress has been made across the group's businesses, and by focussing resources on the growth opportunities that we have been developing over the last few years, the positive momentum has helped offset the detrimental effect of the proposed Statutory Code."The uncertainty of the past several years is about to be lifted as the government last week published a balanced response to the Pub Company consultation, although we suspect that its implementation will remain a customer distraction for some time. "However, the group is confident that the on-going high growth Vending opportunities, higher margin activity, and further efficiencies provide an encouraging outlook for 2015. The group's markets, products, customers and people are now in place to deliver earnings growth and there is a solid foundation for future profitability."The share price was down 1.47% at 80.79 at 12:41. NR