Data storage vendor Ideal Hardware Plc, New Malden, Surrey seems to be on the move in more ways than one at the moment, what with a rise of 28% in pre-tax profits this interim period, as well as a change of abode to its new facility in Chessington this week. Pre-tax profits were 3.8m British pounds, up from 2.9m British pounds last time, on turnover up 24% to nearly 76m British Pounds. Managing director James Wickes puts this down to improving gross margins in the data storage business, particularly in the tape drive sector. There has been big devaluation in the prices of optical storage kit, he reckons, adding that the collapse in the market for external compact disk drives as CD-ROM drives replace floppy drives as the sole storage device for the desktop, has also contributed. Nevertheless, Ideal experienced a big increase in overheads, due to the integration of its PTI Ltd and Kinexus Ltd acquisitions (CI No 2,944); the formalization of its employee training program which it is calling, The Institute, and the purchase of its new premises. The company believes the Internet will provide a low-cost means of distributing up-to-date information to employees and customers alike, complementing the IT Network private television channel that keeps it in touch with its dealers, and was derived from its Kinexus acquisition. It is also counting on significant savings once Internet trading becomes widespread. Although said to be fully integrated, the other acquisition, PTI, is not being exploited to its full potential at the moment. One the bonuses of the purchase was to be the use of PTI’s extensive channels in Europe and elsewhere, none of which are being used currently. Wickes explained that Ideal’s main target is the reseller market, and that PTI only has access at distributor level. Ideal, already a distributor of Hewlett-Packard Co tape and CD-Recordable drives, has also expressed an interest in selling the latter’s Jukebox, but Hewlett seems to want things to remain as they are with its existing distribution channels. Ideal will be paying a 5.2 pence dividend this interim.
