Expansys chief leaves after reining in losses

THE chief executive of Expansys, the online retailer controlled by Dragons’ Den star Peter Jones, has resigned after 10 years with the business.

In a brief statement to the stock market the firm said Roger Butterworth had left to pursue new business opportunities. He will be retained as a consultant until June 30.

The news came as Expansys announced it had significantly cut its losses after stripping out costs.

The Manchester-based business, which specialises in selling handheld devices like phones and GPS units, saw losses rise during the year to April 2009 and has since embarked on a wide-ranging cost reduction programme.

This strategy has paid off with pre-tax losses for the six months to October 31 falling to £24,000 from £1.1m in the corresponding period of 2008. Revenue fell 6% to £20.4m but the group said this represented the end of a rapid decline.

In the results Expansys did not detail the cuts it has made to reduce costs, but said administrative costs had reduced to £3.1m from £4.3m in the previous six months. During the year to April Expansys cut 86 staff, saving £162,000 a month and repaid a £1.5m bank loan, cutting interest charges by £15,000 a month.

Chairman Graham Dawber said: “This has been a period of consolidation for the group, following the successful but disruptive major cost reduction programme undertaken over the previous 18 months. I am pleased to report that, operationally, the group is now in better shape than it has ever been with a cost base appropriate to its size. These efficiencies have enabled us to deliver a much improved result.

“However, the market remains uncertain and our operational strategy will be to keep our costs low, our stocks low and to exploit opportunities as they arise.”

Peter Jones now has a 70.25% stake in Expansys following a share placing with his Virtual Phone Shop business in June 2008, that raised nearly £2m.