IT consulting firm Arinso International BV reported strong revenue growth in the first half of the year driven by its human resources and payroll outsourcing business.
In the six months to June 30, 2004, the Brussels, Belgium-based company increased net profit six percent to 2.6 million euros ($3.1 million) on revenue that grew 18% to 73.6 million euros ($88.7 million).
Arinso made around 66% of its first half sales from providing consulting and systems integration services around ERP applications, but like its larger IT services rivals IBM Global Services and EDS Corp, it is trying to build up its activities in the fast-growing business process outsourcing (BPO) space.
Some four percent of the company’s sales came from its HR business consulting business, and the remaining 30% came from its Arinso People Services unit, which provides outsourced payroll and HR services. Arinso said this part of the business is on course to represent 45% of the company’s total revenue within three years.
Arinso invested 2.5 million euros ($3 million) in its HR outsourcing infrastructure during the first half of the year. This included funding its service center in Atlanta, Georgia, which currently has 165 agents, and the company is also investing in a multi-company payroll outsourcing platform aimed at mid-size companies with between 300 to 5,000 staff.
Arinso said that total sales grew 17% in the second quarter, despite weakness in demand for PeopleSoft-related projects in the US. It said: The continuing Oracle-PeopleSoft saga delayed some important projects in the pipeline. Coupled with a poor performance by its German and Moroccan operations, this led to a reduction in pre-tax profit margin from ten to eight percent in the first half of 2004.