i-documentsystems

Information and knowledge management software supplier i-documentsystems (IDOX) appears poised to report a maiden profit, on the back of improved first half numbers to 30 April. Interim results from the outift, which has developed a particularly strong reputation in the local government sector, showed sales surging 72% to £3.3 million as losses fell £270,000 to £190,000. This left chief executive Andrew Fraser confident that profitability is now within reach. His expectations are matched by research house Hardman & Co, which forecasts a £750,000 profit for the full year. Sales also seem set to take a quantum leap forward - thanks in no small part to May's acquisition of information management services firm TFPL - and Fraser says that annualised revenues are now nearing £10m. Aside from boosting revenues, the acquisition adds an obvious string to the company's bow too. 'Historically IDOX has very much been a public-sector focused software supplier and TFPL brings a service element to the business,' explains Fraser. With £2.4m still in the bank IDOX is now perfectly positioned to make the breakthrough many have long expected of it. So while a prospective p/e of 26.7, for the current year, is rather full, a rating of only 11.7 for 2004/05 is far more enticing. If you bought in on our 11.25p recommendation in October keep holding. If not the shares are well worth considering.

Sector: Software & Computer Services

Companies: IDOX

Market cap: £18.4m

PE Forecast: 26.7

Share price: 12p

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