CSG writes down $55 million from print business

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CSG writes down $55 million from print business

CSG has written down the goodwill of its print business by $55 million and missed financial expectations for the financial year.

The company said the impairment would have no impact on trading, and that it would provide more details when it releases its audited financial report for the year ending 30 June 2017.

CSG provided its unaudited results, which showed revenue of $245 million, a drop of $1.1 million from last year, which the company said was below expectations. Underlying EBITDA was $30.3 million.

The underwhelming result was pinned on a $7 million shortfall in the enterprise solutions business, consisting of $4 million in transactional equipment revenue for an enterprise managed print contract, and $3 million from an IT managed services contract that is still in the pipeline.

On the upside, CSG increased the customer base of its 'as-a-subscription' product suite to 27,300 seats. The company added 9200 "low-value seats" this year when it spent NZ$300,000 to acquire PC Media, a New Zealand managed IT services and Microsoft cloud partner.

CSG also acquired Brisbane-based managed IT services provider R&G Technologies for $6.6 million earlier this year, which added additional IT, cloud and managed services capability.

CSG revealed its as-a-subscription offering in 2015 in an effort to transition from a managed print business into an end-to-end managed IT services provider. CSG forged an alliance with office supplies giant Officeworks in December to deliver its device-as-a-service offering in retail outlets.

The company said subscription sales accounted for more than 15 percent of revenue and expects this to increase to 25 percent in the 2018 financial year.

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