Diagonal Plc, the Surrey UK-based information technology consultancy, took a huge knock in the first half of last year, loosing its biggest client to IBM Corp, but a surge in SAP related business in the second half has rescued the financial results. Net profits for the year to November 30 were up by 63% at 2.1m pounds while revenue rose 58% to 44.8m pounds, and chairman Mark Samuels admitted that 1997 had been a tale of two halves. Early in the year, Diagonal’s biggest client since 1991, the giant supermarket chain Asda Group Plc, outsourced its entire IT function to IBM Corp. And with the Asda contract went a huge slice of Admiral’s revenues, based around the development of back office systems. But the remainder of the year met with success in recruiting large numbers of experienced SAP consultants. Diagonal, which floated in London just under a year ago, now derives over 40% of its revenue from SAP related business with both the SAP consulting division and the SAP staff recruitment agency doubling their revenues last year. The directors have recommended a final dividend of 1.8 pence, bringing the total for the year to 2.6 pence, up 160%. The shares rose 5.5% to 870 pence on the news.
