How Vita cracked 100 Telstra Stores while Mac sales sunk

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How Vita cracked 100 Telstra Stores while Mac sales sunk

Vita Group added tens of millions in revenue, doubled its profits and reached a milestone 100 Telstra Stores in the six months to 31 December, even as computer revenues fell.

The Apple and Telstra retailer's growth streak continues to to build momentum, with revenue from Telstra stores booming on the back of the iPhone 6 launch.

Vita Group adding $76.9 million in revenue compared with the six months a year earlier, with total revenue reaching $292.7 million.

Chief executive officer Maxine Horne singled out the iPhone 6 launch as a key contributor. "Mobile was strong, supported by the launch of the iPhone 6, but we also delivered growth across the fixed, broadband, media and value-added services categories in retail and business channels."

Continued expansion of the company's Telstra business helped push Vita Group to a $9.3 million underlying net profit after tax, up from $4.2 million the same period a year earlier.

The result looked even stronger once amortisation and a previous major non-cash impairment charge on the Next Byte business were taken into account, with overall net profit after tax rising to $13.4 million, up from a $15.2 million loss.

Vita Group is now a major presence in the telco retail channel, reaching a milestone 100 Telstra stores in the six months to December. Those stores are performing strongly, with revenue up 24 percent on a like-for-like basis.

Computing now makes up a fraction of the company's overall sales. The performance of Next Byte improved, but overall computing revenue was down by more than more than $10 million, mainly driven by a reduction in store numbers.

Vita Group intends to deliver improved financial returns from the Next Byte business, but a decision was made to redirect some human and capital resources away from Next Byte and into "more profitable growth opportunities", primarily the telecommunications business. 

The company's enterprise IT business is yet to make a significant contribution while investments are made, though revenues were up 75 percent.

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