At the end of Q1 2000, realTech posted a 67% or Euro 0.29 million decrease in earnings before income tax. The company that provides technical consulting and outsourcing services, and develops ERM software reported that earnings before interest, taxes, depreciation and amortization (EBITDA) reached Euro 0.99 million, the same level as last year.
realTech posted a net loss of Euro 0.15 million following a profit of Euro 0.51 million for the first quarter of 1999. In contrast, revenue increased by 68% to Euro 9.4 million, compared to Euro 5.6 million for the previous year. When we asked, the company replied that these results were within expectations. The net loss is due to charges incurred by the American and Australian subsidiaries, and since the international subsidiaries did not carry their losses forward, the tax ratio came in over one hundred percent.
These results overshadowed the positive results achieved by Europe and New Zealand. Operating income was additionally burdened by substantial investments: Euro 0.31 million in the Marketing and Sales departments and Euro 0.2 million in R&D. Ms. Edelmann, realTech’s spokeswoman, informed us that these investments would have a positive effect on the results in the 2nd half of FY 2000 at the latest. This explains why the company will not be revising its estimated earnings and profit expectations. On the contrary, the figures will undergo an upward correction once the acquisition of a American e-business company (yearly revenues between approx. USD 22 and 24 million) has been finalized. The company expects to self-sufficiently increase its FY 2000 revenues to Euro 42 million.
