ASG bounces back from loss and sees $200m of "opportunities"

Australian services provider ASG has announced a return to profitability following a $6.9 million loss in the first half of 2013.

Today the company revealed a net profit before tax of $5.6 million for the first half of 2014, up $12.5 million on the same period the year before. Revenue increased 4.2 percent to $79 million during the same period and EBITDA was $10.7 million, compared with an EBITDA loss of $2.3 million the same period last year.

The positive growth includes $100 million in contracts won during the first half of 2014 in the government and private sector.

Those contracts are now being bedded-in. "They haven’t really contributed much in the first half but they will contribute a lot more in second half," said CEO Geoff Lewis.

Today's financial results are a vindication of ASG's "New World" strategy of focussing on transaction-based services, according to statements released by the company. These services revenues accounted for 8.75 percent of revenues in the first half of the year.

The company has $200 million in opportunities at either "proposal or qualification stage", including $50 million "qualified" opportunities falling into the "New Word" category.

"We hope to be announcing something in the next three months," Lewis said. "Hopefully we'll have some announcements in the very near future. There's a couple of them."

Asked whether ASG would be making acquisitions, Lewis said it was "very, very unlikely."

"We are focussing on completely organic growth. It's very unlikely unless something very strategic came across our desk."

In line with this strategy, the company has invested $1.7 million in SaaS capability.