Mobile and IT distributor Cellnet has seen its revenue continue to decline by a further 15 percent in the final six months of 2006.
Its sales revenue fell to $269 million in the six months ending 31 December 2006, compared with $319 million in the corresponding prior period.
The firm’s only glimmer of hope was its net profit which rose to $2.9 million from the $0.7m achieved in the same period a year ago. Earnings before interest and income tax also rose to $4.2 million from $2.7 million in the same period a year ago.
However the improved figures include $2 million from the sale of property in New Zealand.
Last year CRN reported that Cellnet blamed a $10 million decline in its first quarter telco sales on Telstra’s decision to appoint Brightstar as its sole distributor for mobile phones.
The telco giant was again blamed by Cellnet for its dipping six month results with managing director Adam Davenport stating Cellnet “had lost significant revenue following Telstra’s decision”.
Davenport told CRN Cellnet has two parts to its business, Telco and IT. He said IT business has remained much the same, but the telco landscape is going through a turbulent time, with a number of companies in the space affected.
“While the bottom line itself fell short of the company’s potential, there were nonetheless encouraging signs. The changes in the market environment mean that Cellnet’s restructuring program will take longer than we anticipated,” he said.
Davenport said the telecommunication and information technology markets are tight and highly competitive.
“Some events beyond our control have delayed the benefits we would expect to see from all the changes we have made to the business. However Cellnet is well positioned to compete in our key markets,” added Davenport.
Cellnet slide continues
By Trevor Treharne on Feb 27, 2007 2:23PM