City Briefs: Getech; Servelec Healthcare; EDP; MJ Gleeson; Hammerson

OIL business Getech announced this morning that first half revenues will be lower than expected due to irregular purchasing patterns across its customer base but said it remains optimistic for the second half of the year.

The Leeds-based firm, which specialises in the provision of exploration data and geological exploration studies to oil companies, said in a trading update for the six months ending January 31 that it has seen strong demand for its consultancy work in the first half of the year.

“However, irregular purchasing patterns across the customer base, driven by cyclical budgetary constraints, have resulted in reduced levels of overall revenue in comparison to the previous period,” it said.

Getech said it expects revenue for the first half to be £3m (2013: £3.9m) giving a profit before tax “substantially lower” compared with the corresponding period last year (2013: £1.4m).

It said the balance sheet remains strong with over £4m in cash at the end of the period and said its directors believe that the company will still trade in line with expectations for the full year.

Stuart Paton, non-executive chairman of Getech Group, said: “Whilst we have witnessed lower than expected revenue in the first half, we believe this is an industry wide issue and anticipate a return to normal demand cycles in the second half. The positive feedback we have received from clients has confirmed there is no reason to question the value proposition of our products and we remain optimistic that we will see further significant contracts coming through in the second half.”

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SERVELEC Group’s healthcare division has had a positive start to 2014 with a number of contract wins.

Servelec Healthcare has been awarded another preferred supplier status under the London Framework for Mental Health and Community.

In addition, in January, Servelec Healthcare took a Portsmouth Hospitals NHS Trust live with its Oceano Emergency Department Solution.

“The delivery was the quickest installation to date by Servelec Healthcare with the project commencing late 2013 and was achieved in the most challenging winter period that A&E departments have seen for some time. The company’s Oceano customers are growing and this new live installation brings the total deployments of this innovative product to three new sites,” the company said.

Servelec’s activity and presence in the community health sector has also strengthened with a community win in the North of England for a spine-connected community hospital deployment which went live at the beginning of the year.

Alan Stubbs, chief executive, said: “We are excited about the start that Servelec Healthcare has made to the year, three out of three in the London Refresh, together with two successful go-lives. It is an illustration that our healthcare division has the right product portfolio, market position, route to market and delivery capability to capitalise on the growth opportunities ahead.”

Servelec will announce its preliminary results for the year ended December 31 on March 12.

The company operates from offices around the UK and internationally, with the largest number of its employees based at the company’s headquarters and purpose-built engineering site in Sheffield.

Servelec Healthcare specialises in the design, development and implementation of electronic patient record software within secondary care settings and is a market leader in the mental health and community health sectors in England.

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ELECTRONIC Data Processing (EDP) said today it is well placed to take advantage of future opportunities, including possible acquisitions, although businesses in the sectors it addresses continues to face a mixed picture.

The Sheffield-based wholesale distribution IT supplier said in an interim management statement covering the period from 1 October 2013 to 14 February 2014 said that business confidence “remains patchy” and as a result it has seen many organisations continue to exercise a “significant degree of caution” when assessing their IT expenditure decisions.

“Contracted recurring revenues, which relate principally to on-going software licence fees and hosting charges, remain strong and represent 86% of turnover year to date,” the company said.

“We have a strong, debt-free balance sheet with cash balances of £5.6m. Our robust business model and significant financial strength place us in a strong position to take advantage of those opportunities which do arise in the future including possible acquisitions.”

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PROFITS and revenue have soared at urban regeneration business MJ Gleeson.

Gleeson was established in Sheffield by Michael Joseph Gleeson in 1903 and today, in its interim results for the half-year to the end of December 2013, reported a 32% increase in revenue to £34.4m (2012: £26.1m), which the group said reflected a rise in the number of units sold by Gleeson Homes and a decrease in revenue for Gleeson Strategic Land, which sold two sites in the period.

The group’s operating profit increased by 112% to £2.6m (2012: £1.2m) and pre-tax profits jumped to £2.7m (2012: £1.3m).

Dermot Gleeson, chairman of MJ Gleeson Group, said: “As anticipated, revenues and profits for the first half of the year showed a strong increase over last year, driven by increasing demand for affordable homes amongst our core customer base in the North of England.

“Gleeson Homes has commenced 2014 with a very encouraging level of visitors, and the number of reservations secured in January and early February has been well ahead of the level secured in the same period in 2013. Strategic Land continues to enjoy a considerable level of success in securing residential planning permissions and is currently progressing the sale of a number of sites. Against this background, the board anticipates further substantial improvements in the group’s trading performance and is therefore confident of delivering a result for the full year in line with expectations.”

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THE property developer behind the £150m Victoria Gate scheme in Leeds has seen pre-tax profits leap.

In its results for the year ended December 31 2013, pre-tax profit for 2013, including discontinued operations, was £341.2m compared with £142.2m the previous year. The business reported growth of 2.1% in like-for-like net rental income and strong demand for high-quality retail property, with new rents secured of £24m, compared to £19m in 2012.

The £150m development of Victoria Gate received planning approval in September. The 34,300 sq first phase of the scheme is set to generate 1,000 construction jobs and a further 1,000 retail and hospitality jobs when it opens in autumn 2016.

The development, which work has commenced on, will house more than 30 retailers, six restaurants and new leisure space. It will be anchored by a 21,000sq m flagship John Lewis store, which will link to the existing Victoria Quarter centre and include an 800-space multi-storey car park. The estimated annual income from the scheme is £10m, of which 28% has been let or is in solicitors’ hands.