Blood in the water at Oakton
Australian IT services outfit Oakton today revealed the extent of the damage it has so far suffered from the global financial crisis, with both revenues and profits sinking over the past year and further staff cuts made.
"As reported in February 2009, our operations had been severely impacted by the global financial crisis, which was further exacerbated by reduced levels of federal government IT demand," the company's chief executive officer Neil Wilson said in a statement.
Oakton's revenues over the year to 30 June sank 3.8 per cent to $193.8 million, while net profits were down 48.4 per cent to read $14.3 million.
ZDNet.com.au has reported a number of unusual events within Oakton over the past year. For example, the company pared back its total headcount by a net total of 90 over the second half of calendar 2009, lost its chief operating officer Steve Parker after just a year, and started reviewing the future of its enterprise resource planning business.
At the end of 2008, Oakton had 1199 staff, including 100 based in India. Today the company revealed it had pared its ranks further, down to 1157, with its Indian headcount up by 10. Wilson said Oakton had conducted an operational review of its business and implemented a number of changes, which were already having a positive effect.
"We continue to optimise the cost structures of the business and are confident of further margin improvement into FY2010," he said. "It is pleasing to report that we have built a strong level of committed revenue and a solid pipeline of potential revenue as we enter FY2010."
The news had a substantial effect on Wilson's own remuneration; in 2008 the CEO picked up $856,921 in total benefits, while this year he only won $745,515. The decrease mainly came from the lack of a $100,000 cash bonus he won in 2008.
However, executive chairman Paul Holyoake's total benefit rose, from $329,840 last year to $430,353 this year.
It hasn't been bad news for everyone in Australia's IT services community over the past year, though. Earlier this month Perth-based ASG posted steep jumps in revenue and profits for the past financial year, throwing down the gauntlet to larger players like IBM, EDS and CSC.