Accumulated losses of the first 3 years have only been neutralized in the last accounting period for which actual results are available. Consequently, the company has never declared a dividend, and does not even forecast one for the first year of forecasted business results.
2. The Gross Margin has improved from 18.75% in 2004 to 21.57% in 2005. The forecast Gross Margin for 2006, at 22.92% is only slightly higher than the latest achievement of 2005. However, fuel costs, which are significant for a business such as that of PDS is forecast to rise to 26.04% of revenue, as against 25.49% in 2005 and 25% in 2004. It appears that PDS is not able to secure protection against a major inflation driver in to its business contracts. However, PDS has been able to reduce variable labor expenses from 56.25% of revenue to just 52.94% in 2005, and expects the trend to continue with a forecast of just 51.04% in 2006. These are significant productivity gains in a challenging human resources environment. Similarly, staff salaries are forecast to remain constant in 2006 compared to 2005, though net profits will more than double.
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