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Fleet management outfit VB Holdings suffered a 95 percent drop in profit for the half year ended June 30 2009, it revealed in its un-audited financial statement filed at the South Pacific Stock Exchange.
Its financial statement revealed a 20 percent drop in sales revenue, amidst what it said was an increasingly tough operating environment.
The announcement coincided with the release of VB Holdings’ 2008 annual report, in which CEO Nitish Niranjan disclosed a gradual drop in earnings compared to 2007.
Both its fleet management and property management business suffered due to the tough business climate and the trend continued into the first half of this year.
“The financial results for VBL for 2008 shows a 46 percent reduction in pre-tax profit to $196, 210 versus $366,584 achieved the preceding year, was disappointing but not entirely unexpected against a challenging commercial and operational environment,” Niranjan said.
Revenue from fleet management, the company’s core business, dropped by 21 percent while property management dropped by 11 percent.
In the first half of this year, this “disappointing” trend was again reflected in the 95percent reduction in pre-tax profit, which recorded marked decline from over $207,000 to just over $9,500.
The company finally posted a net profit after tax of $6,604 compared to $142,956 in the previous corresponding period.
Niranjan however remained optimistic about business and revenue streams this year.
“Business has been significantly down compared to last year due to tough market conditions; however, we hope there will be more activities in the year 2009 and 2010 as tourism market regains its momentum.
“The government of Fiji introduced leasing options for its vehicles replacements, which should provide opportunities,” he said.
VBL last traded at $2.70 per share and had a net asset value of $3.03 million at the end of 2008.
