A UK engineering company, which decided to write its own software package ten years ago because it believed none of the products on the market were suitable for its operations, is about to reap a reward of around 10m pounds for its endeavors. SEP Industrial Holdings Plc has decided to float off its Quintech Computer Services Ltd subsidiary, because directors believe it will prosper better as an independent company. With revenues over the 5m pound mark, Quintech has achieved accelerating growth rates of 122%, 260% and 470% over the past three years. And the success of Sandbach, Cheshire-based Quintech’s Qds system has been achieved against competition from established giant SAP AG’s R/3 product. QDS is a Unix-based system that is built on Unify Corp’s U2000 relational database. It is designed to help organizations manage their warehousing, distribution and manufacturing processes. Where Quintech sees its big advantage over the competition is that, because it was born out of a manufacturing and distribution company’s needs to manage its operations efficiently, it is better placed than those from a purely software background to understand the needs of customers. Quintech insist that its system could be scaled up to 2,000 users if necessary though its present installations tends to run between 50 and 350. An IPO is scheduled for later this year and estimates of its market valuations have ranged between 6m pounds to 15m pounds. By separating from the parent company, Quintech hopes to be in a better position to sell to SEP’s competitors, and motivate staff in a market where there is fierce competition for skills. Quintech will float at an eventful time for the company. It has just sold its first overseas system to a customer in Australia and is in talks with an international distributor. QDS is a premium-priced product, sold with a promise of a six month pay-back. While SEP’s own financial record reflects the problems of UK manufacturing industry, the rewards it will reap from developing Quintech show that, occasionally, developing software in-house can pay big dividends.
