Dillistone Group's full-year profit will be in line with expectations

8th Feb 2017 08:49

(ShareCast News) - Dillistone Group, a software provider for the recruitment industry, anticipates that full-year profit will be in line with expectations with growth in revenue and earnings as it gained from recent foreign exchange fluctuations, but was affected by economic turbulence last year.The AIM-listed company said that pre-tax profit, before acquisition related items and one-off adjustments, are expected to be broadly in line with expectations for calendar 2016, with year-on-year growth in revenue, profit and earnings before interest, tax, depreciation and amortisation (EBITDA).Currency gains affected revenue and costs, however the net impact of the currency fluctuation had been positive.Dillistone said that economic turbulence in 2016 resulted in a lower than normal level of sales of new licences and subscriptions to existing clients, however licence sales to new clients and upgrades for existing clients remained "strong".The company said it "remains optimistic about making further progress in 2017, although it is mindful of the wider economic influences and their potential to impact on the performance of the business. The group remains profitable and cash generative and continues to follow a progressive dividend policy, subject to the needs of the business".It maintained that product development will continue to be a priority throughout 2017.The Dillistone Systems division saw an improvement in its market performance after a challenging 2015, with growth in the number and total value of new contract wins.Dillistone is also reviewing its amortisation policy for development costs in order to bring it more in line with the industry by writing off all such costs over five years rather than between five to ten years. This would result in a one-off negative adjustment on pre-tax profit for 2016, a minimal benefit in 2017, but would have a positive impact in 2018 and subsequent years.Shares in Dillistone Group were down 2.55% to 95.50p at 1007 GMT.