Technology firm EOH is still on the prowl for acquisitions as the global credit crunch makes it difficult for companies to raise cash for investments and drags their price tags down.
The company said it had the cash to buy smaller firms.
Chief executive Asher Bohbot said on Wednesday that although the macro environment was challenging he believed EOH was well positioned to take advantage of market opportunities enabled by its track record, strong balance sheet and cash reserves.
"We see opportunities in small organisations that want to be part of our business and also have a bigger brother to protect them in tough times," he added.
Cash and cash equivalents at the end of the six months to January were R183.4 million and assets were about R655 million.
In that period EOH bought two companies - Highveld PFS, a contract management business and registered labour broker, for R70 million, to enhance its Global Resourcing business, and REO Consulting, which provides remote technology support services, for an undisclosed amount.
Bohbot said the acquisition would further enhance EOH's annuity income as well as opportunities that the company would seek within hosting and networking, software support, call centre and managed services.
The company's annuity business accounts for 43 percent of revenue.
On Wednesday EOH reported a 28 percent increase in headline earnings a share to 54c. Earnings a share rose 27 percent to 53c. Revenue jumped 28 percent to R559 million.
The performance was attributed to organic growth, complemented by the recent acquisitions.
EOH's revenue is derived primarily from the provision of technology services, which include consulting, systems implementation and integration, managed services, software licence and maintenance revenue and the sale of infrastructure products.
While other technology companies such as Faritec and GijimaAst are embarking on cost-cutting measures, Bohbot said the company would not be retrenching, despite taking over the local business of software group CA. EOH has 1 600 employees.
EOH said CA operated in a growing market with potential revenue of about R400 million.
"We have no freeze on headcount - in fact we are recruiting. As far as CA is concerned, we are embarking on an aggressive growth plan, which will include recruitment of additional resources," he said.
- Shares of EOH were 2.75 percent lower at R5.30.