Riva Group Plc has fulfilled its dire promise of January (CI No 2,326) and posted horrible results for the year to December 31 1993. The Westhoughton, Bolton-based point-of-sales systems supplier recorded pre-tax losses of #2.2m, against modest profits of #134,000 last time, accompanied by a 9.1% drop in turnover to #54.0m. Riva’s Iago has been […]
Riva Group Plc has fulfilled its dire promise of January (CI No 2,326) and posted horrible results for the year to December 31 1993. The Westhoughton, Bolton-based point-of-sales systems supplier recorded pre-tax losses of #2.2m, against modest profits of #134,000 last time, accompanied by a 9.1% drop in turnover to #54.0m. Riva’s Iago has been continental Europe, particularly the Spanish market, which lost around #900,000, and France and Denmark, with #500,000 each, which have drowned the UK profits of #750,000, on #20m sales. For Peter Giles, chairman, the priority for the following year is to manage working capital more effectively and to return the group to profitable trading. A;though he believes the group was adversely affected by the continuing European recession, he admits it is culpable of a lack of focus in some of the group’s subsidiaries and weak financial management. The rectification of this situation will come from the institution of financial controls, to maximise the company’s turnover and redundancies which will not exceed 5% of the group’s 800 employees. Giles believes that there are plenty of opportunities in the market, pointing to the group’s #50m turnover and the growth in the UK market, and hopes that new products: the 54/62 instore food till now available, and the new personal computer-based 54/70 with Powerstore software running under Windows to be launched fourth quarter this year, will optimise the group’s potential. Otherwise, he expects 1994 to be a year of rationalisation and consolidation throughout Europe and promises that specific initiatives are being addressed to stem these losses. As to liquidity, the company succeeded in reaching agreement with its principal lenders on January 4 to restructure its bank and other loan facilities. Following a repayment of #1m, facilities of #7.1m have been renewed on a continuing basis of which #5.5m is reviewable next January. The effect of the results was to shave only tuppence off the company’s share price to 16 pence, as the results matched market expectation.
