ASG inks AU$9m Department of Education and Training deal

IT consultancy firm ASG has been awarded a AU$9 million two-year managed services deal with the Victorian Department of Education and Training, off the back of its AU$9.5 million FY15 net profit.

The Victorian Department of Education and Training (DET) has awarded a AU$9 million two-year managed services contract for its information technology division to IT consultancy firm, ASG.

The Australian-listed company has worked with DET since 2007, having been previously tasked with the delivery of the application maintenance and infrastructure hosting services for DET's HRMS/payroll system, eduPay, and Recruitment On Line system.

"State government departments are looking for cost effective, scalable, and flexible IT systems that can help them deliver their objectives," CEO Geoff Lewis said.

"ASG has the experience in tailoring and implementing effective solutions."

For the financial year ending June 2015, ASG posted a net profit after tax of AU$9.5 million, up six percent from the same time last year; whilst earnings before interest, tax, depreciation, and amortisation (EBITDA) was AU$20.2 million, down 8 percent from FY14 EBITDA of AU$22 million.

Over AU$200 million worth of contracts were awarded to ASG during the 2015 financial year, including the signing with West Australian government-owned power company, Synergy, in a AU$15 million, three-year managed services contract. Synergy -- which retails electricity to the state's southwest, including Perth -- merged with Verve Energy early last year, with the former having previously utilised ASG as its managed services provider.

In May, ASG also secured a five year, AU$18 million contract with the Department of Communications, which would see ASG transition the federal government department into the cloud.

In its 2015 financial results, ASG told shareholders it had AU$345 million worth of Australian contracts in the pipeline, with a total of AU$140 million to come by way of Australian Capital Territory-based deals.

Three months into the 2016 financial year, ASG has already signed over AU$90 million worth of contracts, in addition to the DET deal. Last month, ASG signed with Victorian energy provider United Energy and Multinet Gas in a five-year AU$22 million infrastructure managed services deal, which also has three one-year expansion options.

"Delivering managed services is a fundamental core services offering for ASG," Lewis said. "We are looking forward to continuing to bolster ASGs presence in Victoria."

ASG also renewed its contract with another West Australian government-owned company, Western Power in August, in a AU$40 million three-year deal. The IT consultancy firm has been tasked with the completion of the state government-owned power maintenance and infrastructure provider's IT infrastructure transformation, as well as the management of its vendor transition program, which includes managing Western Power's datacentre consolidation and move.

In July, the company also secured a AU$35 million contract with international contractors CIMIC -- previously Leighton Holdings -- in an initial five-year managed services contract to provide CIMIC with both application and infrastructure managed services. It will support CIMIC's JD Edwards enterprise resource management and business intelligence suites globally.

In the first half of the 2015 financial year, Vocus Communications acquired one of ASG's datacentres for AU$11.7 million. ASG remained a tenant of the datacentre in Perth, providing hosting services to their managed services clients. As part of the deal Vocus became the preferred supplier to ASG for all telecommunications services both locally and across Australia.


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