CSG expects growth in FY11 despite pressures

IT services company CSG (ASX:CSV) has forecast an up to 33 per cent increase in FY11 profit, despite pressures from the recent natural disasters in A/NZ

IT services company, CSG Limited (ASX:CSV), has forecast a full-year profit of between $38 million and $42 million, and said its key businesses were growing despite the impact of recent disasters in Australia and New Zealand.

The guidance compares to its FY10 profit of $31.5 million.

The company said it expected the underlying performance of its technology solutions business to improve, with the unit earning more in the second half than it did in the first.

CSG's print services business is also expected to improve its earnings in the second half relative to the first, despite the impact of the Brisbane and Towoomba floods, a temporary moratorium on sales activity in Queensland and one-off litigation costs.

But its Queensland business will likely see a sequential reduction in revenue and earnings in the second half as a result of these pressures.

CSG predicts flat earnings for its New Zealand print business in Australian dollar terms, but expects the unit's earnings to show “overall growth” in local currency even though sales were hit by the Christchurch earthquake.

The company said it believed it was now in a position to achieve strong organic growth from FY12 and beyond.

CSV shares grew 8.9 per cent to $1.285 during Monday's trading as a result of the upbeat forecast.

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