CSG will launch a new business division midway through this year as it continues to reinvent the brand following the sale of its technology solutions business last year.
CSG announced it would offload the technology division to Japanese technology giant NEC for $227.5 million last July, in its 2013 fiscal year.
It subsequently spent $25.9 million over 2012 to review all its assets and embark on a company-wide restructure which included streamlining its enterprise print solutions business across A/NZ.
It cut $13 million in costs and 30 jobs from its 600-strong workforce as a result.
The company today reported its results for the first half of 2013, ended December 31 2012. It recorded a jump in net profit to $5.5 million.
It restated its first half of 2012 net profit at $800,000 to exclude the sold technology solutions business. Prior to sale, net profit for FH12 was $9.3 million.
It also recorded a fall in revenue from $110.4 million to $91.2 million.
The company said the decline in revenue was a result of a new payment plan to incentivise staff, reduced equipment sales in some regions following the workforce restructure, reduced services sales and increased competition.
Revenue from services fell from $50 million to $43.4 million, and equipment sales were down from $41.4 million to $29.1 million. Despite the revenue drop, CSG said it had “stabilised and returned the Australian business to profitability.”
It revealed it had secured a $25 million corporate debt loan with CBA, to distribute back to shareholders at 9 cents a share over the medium term in order to “provide a stable income stream to investors while growing earnings to the point where the distribution is more than covered by the level of NPAT.”
It said that subject to ATO approval, the $25 million will be paid as a capital return in April. The company has net cash of $54.7 million.
Launching the new unit
CSG’s business is separated into three areas across Australia and New Zealand; CSG Business Solutions, CSG Enterprise Print Solutions, and the new Finance unit.
CSG Finance Australia will launch on March 15, with the company investing $7 million as start-up capital. It will be led by current CSG New Zealand managing director Evan Johnson and will be an extension and revamp of CSG’s Leasing Solutions LTD (LSL) business in New Zealand, which the company acquired in 2010.
Johnson’s role will be taken over by current general manager of Konica Minolta New Zealand Warwick Beban.
CSG Finance will cover both Australia and New Zealand, and will provide leasing and finance options for anyone purchasing photocopiers.
New contract
The company also announced a new contract win with Queensland’s Department of Education and Training for managed print services.
CSG will review the department’s current print strategy, initially across six locations in Brisbane as part of a pilot project, and provision new printing and software products over the three year contract.
The deal has the option of two one year extensions. The company declined to comment on the value.
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