IDOX profits rise despite revenue fall

11th Jan 2011 09:06

Document management specialist IDOX posted lower revenues in the year to 31 October, but said that tight cost controls and efficiency gains helped it to a rise in profits.Pre-tax profits climbed to £4.9m from £4.5m the previous year on revenues that slipped to £31.3m from £32.2m.Revenues were boosted by acquisitions, but fell back amid weakness in the contract recruitment business and as a large planning portal project with the Scottish government wound down.Overheads fell by £1.5m 'as a result of tight cost controls and continued productivity and efficiency gains,' the company said."2010 marked significant progression as we continued to improve profits and margins and added to our capabilities in local government shared and managed services," said chairman Martin Brooks."Following three key acquisitions in 2010, we have extended our market share and increased our recurring revenues further in local government, where some 90% of local authorities are now customers."Chief executive Richard Kellett-Clarke told ShareCast that the company enters 2011 with a much more certain outlook than previously now that the dust has settled after the government's Comprehensive Spending Review.A final dividend of 0.35p was paid, to give a full-year payout of 0.45p, up from 0.2p the previous year. Kellett-Clarke said that the increase reflected the company's belief that equities should be more competitive in the current climate, adding that it would not affect its ability to continue making acquisitions.During the financial year, IDOX acquired Grantfinder, which provides databases for government and EU funding information and Strand Electoral Management Services, which provides electoral management software and services. In December, it acquired McLaren, a supplier of engineering document management and control applications serving industries including oil & gas, mining, utilities, pharmaceuticals and transportation.Kellett-Clarke said the company would continue looking to pick up acquisitions of a manageable size that offer synergies and other benefits. While IDOX remains focused on the public sector, the McLaren acquisition demonstrates the company's willingness to 'dip a toe into the water' in the private sector, he said, adding that he thought the market for acquisitions would improve in 2011 due to a strong debt market and more realistic pricing.