Oakton records profit boost

Racks up $1 million in legal fees in Tenix dispute

IT and consulting outfit Oakton (ASX:OKN) has recorded a major boost to its net profit after tax for the year ended June 2010, growing some 42 per cent year on year to $20.2 million.

The ASX-listed company recorded year-on-year EBITDA growth of 32 per cent to $32.3 million and revenue of $186 million, down four per cent on financial year 2009.

The company also noted that it had spend some $1 million in legal costs in relation to the Tenix dispute which is currently in arbitration.

As reported by Computerworld Australia, the dispute kicked off in February when Oakton subsidiary, Oakton Services, was hit for close to $20 million in damages following the break-down of arbitration between the company and Tenix Solutions IMES.

In March Oakton went on the offensive, issuing proceedings in the Commercial Court of the Supreme Court of Victoria against Tenix Solutions IMES.

According to Oakton CEO and managing director, Neil Wilson, the results could be attributed to market share gains in Sydney and Brisbane, a debt reduction program, and improved margins on similar revenue levels.

Looking at the year ahead the company said it would expand its Hyberbad, India office opened in 2006 and now boasting 120 staff.

It would also look to build on a strengthen relationship with its top vendor partners – Microsoft, SAP, Oracle and IBM – signalling its intention to become ranked as a top three partner to all these companies over the next two years.

The company would look toward organic growth, rather than acquisitions, and look for opportunities in Federal Government and application managed services.

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