Advantage picks up after troubled year

By SIMON HENDERY

Advantage Group has told shareholders that it is back trading profitably after a "truly horrendous" previous year which resulted in a $65.8 million loss.

Chairman Evan Christian told about 100 shareholders at the company's annual meeting in Auckland yesterday that the aftermath of the tech wreck, the September 11 terror attacks in America and the general economic downturn in the United States added up to "a very trying time for the Advantage Group and, in fact, for all companies involved in the IT industry".

The company used the meeting to circulate a report it had commissioned which said Advantage's share price plunge since last year's IT crash was in line with other stocks in the sector.

Shareholders approved the issue of more than 10 million new shares in lieu of cash payments for acquisitions, and an options scheme for three executives.

Mr Christian said the company had now sold non-core investments, was focused on preserving working capital and was "ready for the market upturn when it occurs".

Shareholders re-elected Mr Christian to the company's board.

They also re-elected directors Tony Bradley and David Wolfenden, who were appointed during the year, and confirmed the appointment of a new director, Peter Taylor.

Mr Bradley, who was appointed managing director in June, said that despite the company's growing pains he believed New Zealand needed a vibrant IT sector, and Advantage had strong potential.

After reporting an unaudited after-tax loss of $169,000 for the first quarter of this financial year, Advantage was now trading profitably half way through the second quarter, he said.

The meeting approved the issue of 10.2 million shares in lieu of $3.8 million to complete acquisitions of Aldridge Punter and Advantage Portable Technology.

Asked by analyst and Business Herald columnist Brian Gaynor about the payment of more than $300,000 in consulting fees to directors last year, director David Wolfenden, who was not one of three directors to receive the fees, said the board had been forced to act quickly to ensure the company's survival.

"Crisis was the name of the game. If the directors had not rolled up their sleeves at the time, we probably would not be sitting here today."