Microfocus reports decrease in operating cash-flows

10th Dec 2014 22:25

Business application software developer Micro Focus saw a sharp drop in profits at the half-year stage, driven by a fall in licence sales.On a reported basis, statutory pre-tax profit ended 19% lower in the six months to 31 October, to reach $57.1m. That came as like-for-like sales on a reported basis fell 2.5% to $201.9m.Total revenues on a reported basis increased by 0.4% to $208.3m, with a drop in licence revenues off-setting growth in sales from maintenance.Like-for-like licence sales decreased 9.3% to $75.8m. Maintenance sales edged higher by 1.1% to $119.8m.Operating cash-flow from continuing operations decreased to $68.4m from $86.4m.During the period net debt increased 57.4% to reach $258.9m, despite which the dividend was increased by 10% to 15.4 cents per share.That came in part as the company completed the acquisition of Attachmate, for $25.1m.Commenting on the results Investec analyst Julian Yates highlighted the firm's good cost control, which saw operating profits on an EBITDA basis grow. He also expressed confidence in management's ability to turn Attachmate around, given their track record.Micro Focus however did not offer any new outlook information on the above acquisition Yates added, which is what the 'investment case' for the stock revolves around.