Renaissance profit slumps on tight 2007 trading

ICT distributor Renaissance Corporation has reported increased revenue for the year to December 31, 2007, but drastically reduced profits.

Revenue was up from $163 million in 2006 to $187 million, however, the net surplus was cut in half, falling from $6.1 million to $3.3 million. Earnings per share fell from 15.7 cents to 8.2 cents.

"Trading in most market segments remained difficult throughout the year, and this was compounded by several months of supply restrictions of computer products, mainly iMac and Apple portable products," Renaissance's notice to the sharemarket says.

"Demand for Apple products was at an all time high and, as the supply constraints eased in the final quarter of the year, we saw record sales for Apple products.

"The acquisitions of MagnumMac and Natcoll also contributed to our 2007 profit."

The company expensed $1 million for its start-up online music and social networking site Txttunes in the period and completed two acquisition: MagnumMac and Natcoll.

Renaissance says it aims to increase earnings annually and improve the reliability of earnings by introducing more of our own branded products and services.

"Whilst brand representation will remain a core business, we will continue to develop a portfolio of businesses consistent with our strategy to focus on opportunities in the digital economy. 2008 will show further advances in that direction," the statement says.

A final dividend of 3 cents per share will be paid on April 4. Renaissance says it expects to pay a dividend of 6 cents per share for 2008.

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