Jolimont-based Hire Intelligence International has posted a $1 million profit for the 2010 financial year, down from $1.3 million for the previous corresponding period.
Jolimont-based Hire Intelligence International has posted a $1 million profit for the 2010 financial year, down from $1.3 million for the previous corresponding period.
The computer rental group said it recorded total sales revenue of $10.5 million for the year ending June 30. This was slightly down on the 2009 figure of $11.2 million.
Hire Intelligence declared a fully franked dividend of 4 cent per share.
Hire Intelligence restructured its business during 2010 with its emphasis shifting from a franchise based model to one of company owned outlets and property investment.
The company purchased freehold land on Barrack Street during the last financial year for $7.5 million which currently has two tenants paying $700,000 per annum rent.
Hire Intelligence blamed the profit fall on a $500,000 goodwill write off in the Franchise Division and a $300,000 provision for legal fees and bad debts relating to funds owed by the UK Master Franchisee which went into voluntary liquidation.
In a letter to shareholders chairman Tom Crage said, "Your Board is considering a wide range of structural and investment opportunities."
See the chairman's letter to shareholders below:
Dear fellow shareholders
On behalf of your Board of Directors, I present Hire Intelligence International's (HII) 2010 Annual Report.
HII has restructured its business with its primary emphasis shifting from a franchise based model to one of company owned outles and property investment. HII now operates company owned outlets in the Australian, New Zealand and Irish regions previously serviced by franchisees. HII, through its 100% owned subsidiary Cityside Asset Pty Ltd, continues to retain and service Franchise Territories in the United Kingdom.
During the year HII purchased the freehold land and building of 23 Barrack Street, Perth Western Australia (near the corner of St Georges Terrace) for $7.5 million. This investment property has a net lettable area of 1,206 M² with a site area of 359 M². Based on the current plot ratio of 5 to 1, a further 589 M² can potentially be added. The premises are occupied by two head tenants paying a passing rent of $0.7 million per annum.
Hire Intelligence recorded total sales revenue of $10.5 million for the year end 30 June 2010 (2009: $11.2 million). In pound sterling terms our London outlet achieved an increase in revenue however when its results are compared against prioryear in Australian dollars it reflects a drop in revenue of $0.7 million as a result of the weak British pound. The strength of the Australian dollar also adversely impacted on revenue conversions in the Franchise Division as well as opeations in Ireland and New Zealand. Busby Web Solutions revenue has fallen to an inconsequential level.
HII's profits in FY2010 were impacted by a $0.5 million goodwill write off in the Franchise Division coupled with a $0.3 million provision for legal fees and bad debts relating to funds owed by the UK Master Franchisee who went into voluntary lquidation. Busby Web Solutions incurred a loss of $0.2 million. The weak British pound resulted in an exchange loss versus prior year of $0.2 million. The impact of these events resulted in a profit before tax of $1.0 million for FY2010 (FY2009: $1.3 million). Earnings before interest and tax (EBIT) were $1.0 million (FY2009: $0.9 million). HII declared a fully franked dividend of 0.4 cent per share.
Outlook
Your Board is considering a wide range of structural and investment opportunities.
Chairman Tom R Crage
