Eontec looks to new owner for financial support despite cut in losses

EONTEC, the Dublin software firm sold for €109 million in April this year, reduced its losses to €6.6 million in 2003.

Accounts just filed at the Companies Registration Office show pre-tax losses for the year to end December 2003 were down nearly 30% on the previous financial period.

In April Eontec, which provides software and IT services to financial institutions, was bought by American firm Siebal Systems in an all-cash deal.

That netted Eontec’s founder James Callan around €20 million for his stake in the company he set up a decade ago.

The takeover also meant multi-million paydays for several directors of the company, including executive chairman Patrick Brazel.

The sale of Eontec also netted millions for the company’s other investors, who include former Esat Telecom boss Denis O’Brien, ICC Venture Capital and investment bank Warburg Pincus.

Though losses have been reducing in recent years, the company’s retained losses have now topped €41 million and the accounts say the firm is dependent on financial support from its new owner.

Turnover for the year decreased once again, dropping to €13.6m from €15.3m, though the company will be pleased with an increase in software licence sales.

The company shed 50 jobs during the year, reducing its workforce to 142 with the cuts coming from it sales and software engineering staff.

The move reduced the wages bill by almost €2.5m to €9.9m. In 2002, 70 jobs were cut.

The company’s directors were paid €810,027 in fees, salary and pension contributions, a 27% increase on the previous year’s payouts.

The accounts also include an exceptional item of €750,000 to compensate a director for loss of office. It was not disclosed who was the beneficiary of this payment.

The accounts also reveal that Patrick Brazel, Eontec’s executive chairman was paid an additional €325,320 during the year through a company called Sameara Limited, which provided consulting and management services to Eontec.

This was an increase on the €248,127 Sameara was paid by Eontec in 2002.