Companies: BVM   

Mobile computing systems specialist Belgravium Technologies has lifted annual pre-tax profits 11 per cent to £2 million despite falling turnover.

The Bradford-based company, a leader in designing and making real-time data capture systems, saw turnover slide 2.9 per cent to £10.6 million in 2007. Chairman John Kembery blames this on a ‘difficult second half-year’, with financial crises deterring customers from turning interest into orders.

‘The work is still there,’ he insists, ‘and the pipeline is greatly increased, but it takes longer to convert the pipeline into firm orders.’ He says profits rose because of synergies achieved on previous acquisitions: niche petrochemical distribution sector specialist Touchstar and mobile retail systems software developer Novo IVC, now a sales division of Touchstsar.

Belgravium has integrated its services to the UK warehousing and logistics market with Touchstar.  Kembery says the company is launching new specialist ‘streamlined and user-friendly’ hardware at a German trade show in May and will also be launching some new ‘back-office analytical software’.

Touchstar and Novo IVC were chunky acquisitions to finance and digest, and today’s market is not auspicious for paper bids. But Belgravium says it is looking for smaller specialist takeovers, such as in the area of airline software.

The company, which ended 2007 with just £2,000 cash but £3.9 million receivables, proposes a 5.5 per cent final dividend increase to 0.38p, taking the total annual payout to 0.52p. That puts the shares at 11p – 3p below their 2004 float price – on a price-to-earnings ratio of nearly five per cent.

The appeal is speculative     

Growth Company Investor is the UK’s leading authority on small-cap and AIM companies. You can gain immediate access to all the recent share recommendations with no obligation, with a free 30-day trial. Click here to join today.