The contribution by the Information Technology (IT) businesses of the Altron group in terms of group revenue was R4.3 billion while remaining constant at 31% in terms of its contribution to total group revenue. The contribution to group operating profit declined somewhat from 39% the previous year to 31% at R321 million due to margin pressures experienced at Altech NamITech.

During the period under review Bytes Technology Group (BTG) successfully completed the integration of CS Holdings and Digital Healthcare Solutions. These acquisitions have increased the BTG products and services offering and significantly contributed towards revenue and operating profit. Post year end, BTG acquired Xclusive Solutions, a leading provider of document and print solutions and Xerox partner in the United Kingdom, for an initial consideration of £3.2 million that could increase to a maximum of £4.5 million depending on future profit performance.

Bytes Document Solutions (BDS), BTG SA’s Xerox operation, has achieved another year of solid revenue and unit growth in the face of stiffening competition aggravated by product price deflation due to currency and technology changes. Equipment sales were impacted by a significant shift in product mix with stronger sales of lower-priced systems while demand and installation activity accelerated for key products such as networked desktop multifunctional devices and entry-level colour production systems.

Bytes Specialised Solutions (BSS) is the exclusive distributor for NCR products and systems in South Africa and markets, supports and maintains enterprise-wide information products and services for the banking industry. During the period under review, Teradata, a data solution provider for the banking sector and various other organisations, recorded significant operating profit. In the ATM sector BSS has benefited from the impact of the major banks upgrading their ATM base to become EMV compliant, while the new EMV encryption and security regulations have played a major role in improving the division’s revenue.

Bytes Communications Systems (BCS) reported a satisfactory operating performance, maintaining good margins in both the services and product sales arenas. This has been realised through increased small- and medium-enterprise product sales and improved efficiencies in delivering services. Bytes Managed Services, a focused workspace management and equipment maintenance business with 70 service points around South Africa, benefited from the integration and consolidation of CS Holdings which delivered significant value to all stakeholders from a financial, service delivery and growth perspective.

BTG’s international businesses, both those in southern Africa and in the United Kingdom, showed good progress with significant improvement. Bytes Software Services, one of Microsoft’s top three large account resellers (LARs) in the UK, has significantly improved its net profits as a result of substantial restructuring and additional focus on its core competencies. UK-based IT Solutions, which offers Application Development services specialising in largescale e-commerce style systems to blue chip clients, also returned to profitability after a significant restructuring exercise was completed.

Altech NamITech, a leading player in Africa for cellular SIM cards, pre-paid vouchers and magnetic stripe bank cards, experienced a disappointing year due to the continued strength of the rand and pricing pressures. A re-engineering process and a significant cost-reduction exercise were completed to reposition Altech NamITech as a competitive player in this sector of the market. It is expected that the roll-out of EMV-compliant smart cards will contribute significantly to Altech NamITech’s financial success in future. In line with its pan-African strategy, Altech NamITech’s new pre-paid cellular voucher manufacturing facility in Lagos, Nigeria, is now profitable and is producing more than one million vouchers per day.

Altech Card Solutions benefited from the continued migration to the EMV payment standard through the ongoing deployment of EFTPOS terminals, as the banking industry prepares to issue EMV smart cards. The ongoing personalisation infrastructure upgrades by card issuers and outsource bureaus benefited Altech DataCard. Altech Cardtronic also performed well with the recapitalisation project complete, which enabled it to compete more effectively in the higher-volume business segment. Altech ISIS recorded significant financial and organic growth during the year, strengthening its position as a supplier of end-to-end operational support systems (OSS) solutions in South Africa and Africa. Altech ISIS has further entrenched its position in this market through the purchase of MobiMaster, a French business that owns and develops a billing system for pre- and post-paid voice and data services.