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MEDTECH Holdings revenues decreased 12,6 percent to $6 million in the first half of the year to June 30 from $7 million during the same period last year.
The company attributed the revenue decrease to the reduction in consumer spending that has adversely affected demand from retail and wholesale customers.
“We have also withdrawn stock from credit customers who have defaulted on their payment obligations and in the process issued significant credit notes for stock returned. As a result, our revenues have decreased,” Medtech said.
Sales at the fast moving consumer goods division which includes MedTech Distribution and Smart Retail, declined 6,1 percent.
The company has reduced its contract workers by half in a bid to rationalise costs and outsourced part of the merchandising function.
Revenues grew marginally at the group’s manufacturing segment to about $1 million compared to $991 000 in 2013.
The Babyline Petroleum Jelly and Glycerine products are well established, the company said.
The medicals segment saw revenues decreased to $556 000 in the six months to June compared to $1,2 million in the comparative period last year.
MedTech said it has concluded a transaction with 40 percent minority shareholders in MedTech Medical Aid and Scientific (MMS) to acquire their entire shareholding in exchange for shares in MedTech Holdings Limited (MHL), subject to regulatory approvals.
Prior to the conclusion of the transaction, MMS was 60 percent owned by MedTech Holdings and the purchase of the 40 percent stake from Mr J Patel and A Vohra makes MMS a 100 percent owned subsidiary of MHL.
MMS is an importer and distributor of generic pharmaceuticals from India.
The consideration payable to the sellers for the 40 percent stake amounts to $192 104 which is to be settled through the allotment of 240 million authorised but unused shares in MHL which are under the directors of MHL, at an issue price of 0,08 cents per share.
MedTech says it is in the process of concluding agreements to place approximately 70 percent of the authorised and unissued shares in MMS with another pharmaceutical distributor to raise sufficient funds for the business to attain profitability.
The company said the remainder of 2014 would be quite challenging for the economy.
Online Reporter