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E-learning minnow Intellego has been frustrated in its hunt for profits by slow-moving customers and is battening down the hatches to weather the recession.

Although turnover in the six months to September rose 50% to �1.1m, the company remained loss-making, although the interim loss was reduced from �149,000 to �118,000. Two acquisitions were made during the period and both, says chairman Angus Forrest, have been made more profitable.

These purchases were designed to strengthen Intellego’s existing positions in the pharmaceutical and financial services training markets. Zenosis, a provider of online regulatory training for the life sciences sector, has ‘paid back what we spent on it in three months’ but has been unsuccessful in its attempts to sell its products to any of Intellego’s existing customers.

Along with ‘a number of difficulties’ that also had to be resolved at Zenosis, Forrest has been frustrated by a trend among customers to take longer in their decision-making. ‘It often takes 12 months for our big clients to do anything, and there is often a lengthy delay between identifying someone and then producing any work,’ he said.

However, although cash levels are low at just �72,000, Forrest wants to make further ‘small acquisitions that will repay within 12 months’. Another aim is to accelerate the move from reselling products, the core business that is receiving ‘less emphasis’ these days, to producing higher-margin products of their own.

So, while Intellego is making steady progress and promising profits, it remains high risk and there are better prospects out there. Steer clear for the time being.

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