ASG boosts FY11 profit 28%

ASG boosts FY11 profit 28%

IT outsourcer and network security provider ASG Group Limited (ASX:ASZ) said its net profit grew 28% in FY11 to $15.7 million.

The company attributed this, as well as its 27% growth in revenue to $153.3 million, partly to strong organic growth.

Ebitda margins also improved to 18.4%, from 17.9% a year earlier, due to contributions from recent acquisitions, which include Melbourne IT firm Dowling Consulting.

The integration of the acquisitions – including their products - into the ASG business means the company can now compete for contracts in the $100 million to $500 million range, ASG said in its financial report.

The company has already won contracts in new areas including SAP and the mining sector.

But ASG also acknowledged that the acquisitions had “not met the ambitious revenue growth targets set at time of purchase due to unforeseen difficulties in the operating environment.”

During the year, ASG also launched a new Perth-based data centre to support its cloud computing and software as a service ambitions. ASG said this centre is already performing ahead of expectations.

The company expects the data centre to contribute around $45 million to the group's profile over the next 10 years.

Managing director Geoff Lewis said he was confident of the company's prospects for FY12, although he expects the operating environment to remain “difficult” over the period.

ASZ shares grew 5.61% in Thursday's trading to $1.035.

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Tags Mergers and acquisitionsASG Groupexpansionfinancial resultsGeoff LewisASX:ASG

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