Pegasus Group Plc is looking confident about its future as it reported pre-tax profit up 49% to over UKP3m on turnover up 43% to just under UKP11m, as well as announcing a joint venture with the Italian software group ESA. The figures include those of Sphinx for the last four months to July 31 during […]
Pegasus Group Plc is looking confident about its future as it reported pre-tax profit up 49% to over UKP3m on turnover up 43% to just under UKP11m, as well as announcing a joint venture with the Italian software group ESA. The figures include those of Sphinx for the last four months to July 31 during which it traded at a loss. Sphinx which was acquired in March (CI No 1,143), is still running at a loss and has required a further cash injection of UKP1.2m on top of the injection of UKP2m given at the time of the acquisition. Pegasus believes that this financial resuscitation will be worth it when the Unix market finally takes off. Pegasus has two main divisions: software and supplies. Both have seen rapid growth in profits from a rather stagnant turnover (turnover is swollen in the total figures by the acquisition of Sphinx). The growth in profitability within the software division comes mainly from a rationalisation process over the past year during which Pegasus has cut its dealer base from 1,500 dealers to 550. It has also now divided its dealers into those for the MS DOS/OS/2 market and those for Unix. Pegasus Supplies is claiming success in the fiercely competitive world of business forms because of its strong identity. This identity includes a specialist team of telesales people available throughout the group as well as to dealers, and a push to recycled paper products. While Pegasus reiterated its support for the single user as opposed to multi-user market, it is symptomatic of the company’s planned future that Andrew Marshall has been selected to head research and development for Pegasus. Marshall comes from Prime and was described as the first non-DOS man to take this position. Under his leadership Pegasus is committed to exploring the implementation of object-orientation and graphical user interfaces for accounting software, as well as commodity SQL databases. Although Pegasus affably claims that it will support both OS/2 and Unix environments its enthusiasm at present clearly lies with Unix. The reason for this is clear in the run up to 1992 and beyond, for until Pegasus acqui-red Sphinx less than 10% of its turnover came from the continent. Sphinx, however, sells Informix, Santa Cruz Operation and Uniplex software to 14 countries. Willingness to collaborate over the European market for Unix accountancy software would seem to have been the rationale for the trading agreement with ESA. The Italian company specialises in developing accounting and management software as well as in software distribution. The Italian company specialises in developing accounting and management software as well as distribution. It recently bought the J Soft subsidiary, among other things the exclusive distributor for Lotus in Italy (a more meaningful claim following the tight-ening of Italian law regarding software piracy). Ads in the Wall Street Journal ESA also has a holding in the Italian CAD/CAM comp-any Microsystem, and the group’s total turnover will be nearly UKP23m at the end of its current fis-cal year. Under the joint trading agreement ESA and Pegasus have formed a joint company called Osprey Software Ltd, which will specialise in Unix software for the European market. Pegasus has been trying to get a European venture off the ground for a while (as has the entire UK software fraternity), but decided that because of the problem of language differences and the difference in company law and regulations throughout Europe, the easiest solution would be to set up a third party company rather than pursue a merger or acquisition. The grand plan behind the agreement being to mop up European distribution for US accountancy software authors. To this end advertisements have been placed in the Wall Street Journal. Osprey is headquartered in Maidenhead at Sphinx’s offices, but operating com-panies will soon be set up in other European count ries. France is a possibility because of its ad-vanced Unix base, but it already has a well-defined distribution system; Germany has a fragmented deal-er base but Osprey sees less opportunity there.
Spain and Portugal are also being considered and Pegasus is talking with other continental firms.