Tony Wheeler, financial director of Watford, Hertfordshire-based IBM point-of-sale software specialist Real Time Control Plc was right to be cautious at the end of the company’s last financial year (CI No 1,712). Indeed, the group’s first six months to September 30 were testimony to the fact that the UK economy hasn’t improved: pre-tax profits dropped 23% to UKP507,000 on turnover off 31% at UKP3m. In today’s climate, though, it is an achievement just to stay in the black. And, not visibly disheartened, group chairman Byron Carrell – affectionately known as Barney, says the decline in revenues can be put down to a change in the timing of deliveries from year to year. Elaborating, Tony Wheeler says Real Time is very happy about [its] situation: the group seeks major contracts worth from UKP2m to UKP5m, so that the six-monthly profit and revenue figure is dependent on the roll-out of these contracts.
Order book pretty good
The order book at the period end was pretty good, and that Real Time does not have cause for any real concern in the short term. The directors are optimistic enough to expect the current year end to match the figures of the last year end – UKP1.2m pre-tax profits on a turnover of UKP7.6m, which Wheeler insists is not just blind hope – we have a reasonable expectation of doing it, he says, though this all hangs on the timing of contracts. At the same time, Carroll voices concern for the long-term, acknowledging that the willingness and ability of retail organisations to continue to invest is waning in the continuing recession. The only person who feels he can see an end to the recession, Wheeler adds sardonically, is the Chancellor. So what is Real Time doing to protect itself against the depressed retail market? According to the financial director, it is not, nor has been, cutting back in any way. Sure, the group has reorganised, decentralising its corporate activities so that the Plc is more of a holding company, but all company premises remain and there have been no redundancies – in fact, the 120-strong group is actively recruiting. Being cash rich (Real Time reported cash reserves of UKP4m at the last year-end), the group is considering making an acquisition – to diversify from the ailing retail sector. Wheeler says the group has no specific business in mind, but notes that it has been approached by several companies seeking to be acquired, the criteria being simply a good business opportunity, whatever that might be. Specifically, Wheeler said Real Time really wants to get out of the retail sector, but to continue in a software-related business, perhaps in a less vulnerable vertical market. As an IBM dealer, it sells bundled point-of-sale systems to customers but it also supplies software to NCR Corp, for use with NCR hardware. Those are the only two hardware environments supported by Real Time software, though Wheeler says it will do versions for other vendors’ hardware in the future. Aside from a four-man point-of-sale subsidiary in Boston, Massachusetts which made a small loss this time, Real Time’s other interest is in keyboard manufacture. Northampton-based Rotec, which now makes high-value, low-volume specialist keyboards for the industrial sector, contributes between 15% and 20% of group revenues. It produces data entry products sold OEM to terminal manufacturers, for use in nuclear reactors and the like. As to whether anyone has tried to buy Real Time, Wheeler says it has received no serious offers, nor is likely to, given that the chairman and founder owns 56% of the shares.
