TechnologyOne reconfirms profit growth of 10-15% for full year
Australia’s largest enterprise software company, TechnologyOne (ASX:TNE) today announced its results for the half year ending 31 March 2015, posting a half year result which is in line with the market guidance provided at the start of this financial year. Revenue was up 3% to $90 million, and Profit Before Tax down 10% to $11.4 million.
As we have previously indicated, half year results cannot be extrapolated to determine full year results, and TechnologyOne expects strong growth over the full year.
“We are now preferred supplier for a number of very large contracts, which are under contract negotiation,” he said.
“TechnologyOne Cloud grew strongly in the first half, with Annual Contract Value up 100+% to $4.1m. We are on target to have 80 customers by December 2015, with Annual Contract Value of $8+ million, which will be up another 100%,” he said. “We also recently welcomed Wellington City Council – one of New Zealand’s largest councils, Glenorchy Council and AsureQuality as cloud customers.”
“As the cloud computing industry matures, organisations are increasingly avoiding the dirty hosting approach - software that is ‘lifted and shifted’ into a hosting environment - and choosing vendors that can deliver a complete enterprise Software as a Service (SaaS) offering,” said Mr Di Marco.
“The SaaS model serves our customers far more effectively, by simplifying their IT infrastructure, optimising the performance of their platform and enterprise systems, and delivering enormous economies of scale and a future proof solution in a way that hosting providers will never be able to do,” he said.
The market reinforced its confidence in TechnologyOne’s SaaS offering, with the company being named as a preferred supplier on the Australian Government’s Cloud Services Panel.
“This shows significant growth as we transition customers to a cloud first, mobile first world. The next phase of our TechnologyOne Cloud will provide a massively scalable platform with significant economies of scale, delivering us and our customers an even stronger competitive advantage.”
“We expect this strong momentum to continue in the years to come,” said Mr Di Marco.
In light of confidence in the full year outlook, TechnologyOne increased its dividend for the half year to 2.15 cents per share fully franked, up 10 per cent on the prior year. This represents a payout ratio of 75%. The company has continuously paid a dividend since it listed in 1999.
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We participate in only seven key markets: government, local government, financial services, education, health and community services, utilities and managed services. For these markets we develop, market, sell, implement, support and run our preconfigured solutions, which reduce time, cost and risk for our customers.
For 27 years, we have been providing our customers enterprise software that evolves and adapts to new and emerging technologies, allowing them to focus on their business and not technology. Today, our software is available on the TechnologyOne Cloud and across smart mobile devices.