LONDON (Alliance News) - Jaywing PLC Tuesday said that it had started the new year in line with expectations, after it swung to a pretax loss in the year to end-March, damped by acquisition costs.
The digital communications company swung into a pretax loss of GBP380,000, from a profit of GBP1.0 million in the previous year, as revenue declined to GBP26.7 million from GBP26.9 million and it saw acquisition costs of GBP1.1 million.
Jaywing sold its eCommerce integration business Tryzens for GBP6 million in October last year, as there were too few cross-selling opportunities between the business and the rest of Jaywing's operations. It posted a loss before tax on disposal of GBP5.4 million related to this sale.
As a result of shedding this business, the company's direct costs fell to GBP5.1 million from GBP6.2 million.
It acquired Epiphany Solutions in March for GBP12 million to bolster its search marketing operations. Jaywing said it has seen an encouraging performance in its second-half as gross profit rose to GBP11.2 million from GBP10.4 million in the first-half, with the full benefit of the acquisition still to be realised.
The company increased its borrowing to GBP7.8 million to acquire Epiphany, but said that the GBP3.8 million of cash it generated from operating activities and proceeds from the Tryzens sale reduced the amount of additional funding required.
In the company's Agency Services division revenue rose to GBP14.4 million from GBP13.2 million, after it finished a large project for a financial services client in the previous year.
Shares in Jaywing were trading flat at 29.00 pence Tuesday morning.