Categories: Corporate News Date: 2009-03-05 17:23:31 Title: No dividends, all profits re-invested in the companyOmnilogic, one of the biggest IT companies, specialized in the supply and services business, has applied lately an aggresive capitalization policy, redirecting all its income in bank deposits.
Omnilogic, one of the biggest IT companies, specialized in the supply and services business, has applied lately an aggresive capitalization policy, redirecting all its income in bank deposits.
"We have been chosen this solution because we consider it as the best for the time being, the present period being one of the worst times for investments. We make deposits at several banks, in several currencies, for a six month up to one year period, Gabriel Marin, Omnilogic Managing Director, says for Business Standard. The company hasn't paid its dividends for over a year, and its marketing expenses have been massively cut. Last year, this budget was of approximately 0.5–0.7 mil. Euros, which represents 60% of the 2007 budget. For 2009, the marketing budget is estimated to represent 10–15% of the last year budget. The value of the Omnilogic monthly operating expenses is places between 0.8 and 0.9 mil. Euros, of which 40% represent the mortgage cost, the interest rate and the interests, 30%, the wages and the rest goes for utilities costs. "What we have here is quite a, that is to say, even if EURIBOR (Euro Interbank Offered Rate - edit. note) dropped significantly, our access to the commercial credit hasn't improved much. Instead, the mortgage credit line has climbed up dramatically. Our policy did not intend however to acquire long-term debts," Marin said.. Omnilogic has a financing line of 3-4 million dollars, while its turnover is 170 million dollars, according to Gabi Marin. "Our business is seasonal, we meet two peaks, that is in the second and the fourth quarter, and then we need short term financement," remarked the Omnilogic CEO.
The company invested approximately 8 million Euros in a data center near Otopeni, which enables the company to focus on services. "We won't extend the data center any more after we have finished the first phase. If we have clients, we start to build a second data center. This investment will cost about five million Euros, that is less than the one needed for the first data center, because the utilities were designed from the very beginning for both data centers," Gabriel Marin addes. Besides, the company won't upgrade the technological systems that are currently in use, and we will cut the travel expenses and won't take part to promoting events. Omnilogic's last year turnover was of approximately 170 million dollars (135 million Euros), overrunning the estimations made in October, which would forecast sales of about 130–150 million dollars. In 2008 the external markets generated approximately 30 million dollars (23.8 million Euros) of the whole turnover, that is about 17.6%. Pointing to a more pronounced opening to the external markets this year, Gabriel Marin asserts that all markets are difficult for the time being, both domestic and external. Meanwhile, the emerging markets contract significantly, so we'll follow the business, wherever we can." The public sector brought to the company revenues of 10–12 million dollars (7.94–9.53 million Euros), that is between 5.8% and 7.05% of the turnover. On the whole, the biggest sales were generated last year by the financial and bank field, as opposed to 2007, when the biggest sales were made in the telecom segment. As for the business in 2009, the representatives of the company say that at the moment it is very difficult to make a forecast. "Presently, 30% of our the forecasts have a 80% chance to be confirmed, as for the remaining 70%, the probability is between 10% and 90%," Marin added. He also mentioned that Omnilogic would organically grow this year due to the bankruptcy of many players on the market. The company doesn't intend either to grow by means of absorption, as 2009 is a good year to attract the clients of the future bankrupt companies The main competitors of Omnilogic are Tornado, Romsys, S&T, Forte Business Services and Asesoft. (written by Gabriel Preda - Business Standard)