Datalex made a pre-tax loss of $12.9 million (€13.10 million) in the six months to the end of June, 2002, down from a $29 million loss recorded during the same period of 2001, half-year results published yesterday show.
A sharp reduction in operating expenses, which fell to $10.5 million in the first half of 2002, down from $18.9 million in same period of 2001, accounted for much of the reduction in Datalex's losses.
The firm, which develops software for the travel industry, generated revenues of $11.5 million in the first half of 2002, representing a drop from the $17.9 million posted in the same period in 2001.
Datalex posted a 20 cent loss per share for the first half of 2002, down from a loss of 44 cents per share in the same period last year.
Mr Neil Beck, chief executive of Datalex, said the first half of 2002 had seen signs of recovery in the travel industry, in general, and Datalex was now well-positioned to capitalise on the improvement.
"It's something that will come in future results," said Mr Beck. "We're relatively satisfied that the fundamentals are in place... in early October we should make a statement on future profitability."
He said there were several variables that had to pass before the company could be confident about future forecasts, including the the anniversary of September 11th and economy recovery in the US.
Datalex's share price was heavily affected shortly after the attacks on September 11th last year as airlines cut back sharply on their technology investments.
This prompted a major restructuring at the Howth-based company, which resulted in a boardroom shake-up and a redundancy programme that cut staff to 300, down from more than 500 in 2001.
Operating losses before goodwill amortisation and the fair value charge of share awards to employees fell to $7.2 million in the first half of 2002, down from $15.5 million in the same period last year.
Mr Beck said the firm had incorporated a further write-off in its first-half accounts this year of $2.4 million on acquisitions. This charge had been taken to account for discrepancies between US and Irish/UK accounting regulations following Datalex's voluntary delisting from the Nasdaq, he said.
Datalex, which did not give a quarterly breakdown of its results, had a net cash balance of $41.8 million at June 30th, 2002, suggesting cash burn is now about $4 million per quarter, analysts said.
Mr Barry Dixon, technology analyst with Davys Stockbrokers, said there was a 4 per cent increase in revenues in the second quarter compared to the first quarter, but margins remained flat.
He said Datalex might become a consolidation candidate if the environment for technology firms improved.
Shares in Datalex were unchanged last night at €0.30 on the Irish Stock Exchange.
