Softline Limited`s 60% owned US subsidiary, SVI Holdings Inc. announced results for the six-month period ended March 31, 1998. The company has changed its fiscal year-end to March 31 from its former year-end of Sept. 30, 1997. This six month period will constitute the company`s fiscal year-end which will consist entirely of this six-month period. Net sales for the six months increased by over 300% to $16,354,383 from the $3,930,164 reported for the same period last year. This increase is primarily due to an almost 50% increase in net sales at SVI`s Australian subsidiary, Divergent Technologies, which received several large, national contracts and to the inclusion of SVI`s UK subsidiary, IBIS, acquired in October 1997. Income from operations increased for the six months ended March 31, 1998 more than seven fold to $3,365,261 from the $398,673 reported in the same period last year. Income from operations as a percentage of sales increased to 21% for the period ended March 31, 1998 from the 10% reported in the same period last year. This increase is primarily due to a decrease in selling and G&A expenses as a percentage of sales. As sales continue to grow, overhead will not grow at the same rate and therefore operating profit percentages should continue to increase. Net Income for the period ended March 31, 1998 increased to $5,818,967 from the $563,217 reported in the same period last year. Net income includes an after tax gain of approximately $2.7 million from the sale of the company`s Softline Ltd. shares during the period ended March 31, 1998 compared to a gain from the sale of the company`s Softline Ltd. shares of approximately $150,000 for the comparable period ended March 31, 1997. Basic earnings per share was $.21 per share for the period ended March 31, 1998 of which approximately $.10 per share was derived from the sale of the shares of Softline. In the comparable six month period basic net income was $.04 per share of which approximately $.01 per share was derived from the sale of Softline shares. Diluted earnings per share were $.19 per share compared to the $.04 per share recorded in the same period last year. Ivan Epstein, CEO of Softline Limited, said: "During fiscal 1998, SVI made significant strides to becoming an international information technology company with a strong position in its niche markets. SVI`s three operating subsidiaries all showed significant growth in revenues and earnings during the period. I am particularly gratified by the growth achieved in these companies. This growth strongly indicates that SVI`s strategy of identifying companies with proven technology and solid management that can be quickly developed and expanded, is sound.`` Barry Schechter, Chief Executive Officer of SVI Holdings, added: "SVI accomplished a great deal during the six month period ended March 31, 1998. At the beginning of this period we completed the acquisition of our UK subsidiary, IBIS. Within six months of this acquisition we were able to significantly increase the revenues and profitability of IBIS. "In March 1998 IBIS acquired certain key assets of `Multisoft Direct` from Multisoft Financial Systems Ltd., adding approximately 1,000 customers with a current annual revenue base between $4 and $5 million. "Recently we announced the addition of four new members to our board of directors who bring a wealth of talent and experience to SVI. "At March 31, 1998 we had cash balances in excess of $14 million after payment of the purchase price of the assets acquired from Multisoft. SVI is generating a substantial cash flow from its existing operations. We have now established a solid base and expect to show continued growth in our operating profits in the current fiscal year as we build a significant and dedicated international customer base.
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