TechnologyOne keeps profits growing
TechnologyOne has managed to achieve an 18 per cent rise in its initial licence fees for products in the half year to 31 March 2012, keeping its profit in modest growth.
Revenue for the half was up 8 per cent to $77.3 million. As well as initial licence fees jumping 18 per cent to $18.4 million, annual licence fees increased 16 per cent to $25.4 million, and consulting services revenue rose 9 per cent to $21.3 million. Net profit after tax grew 2 per cent, to 9.3 million, despite 33 per cent growth in the last half.
Executive chairman Adrian Di Marco said that the initial licence fee increase saw TechnologyOne outperform its international competitors SAP and Oracle, which achieved single-digit increases.
"We are continuing to steal market share in our vertical markets, including health, education, government, utilities and financial services," he said.
TechnologyOne continues to put focus on research and development (R&D), with $16.6 million spent in the half on mobile solutions, financials, supply chain, human resource and payroll, customer-relationship management, enterprise content management, student management, performance planning, business intelligence, enterprise budgeting, asset management and property and rating systems.
A new area of focus has been the next generation of its Connected Intelligence suite, Ci2.
TechnologyOne has also been banking on specific, pre-configured products that go in quickly to companies of a certain type. It managed to net 38 customers in deals worth more than $16 million since their launch at the end of 2010, with a recent win being Townsville City Council.
"We believe that the model used by other software vendors of relying on third-party organisations, such as Accenture, to implement their software solutions is broken. TechnologyOne customers benefit from a direct relationship with us every step of the way, and we are therefore always accountable to them," Di Marco said.
The company has opened a new R&D centre in Indonesia, which it said was necessary due to a lack of Australian graduates. In these results, the company said it hopes that the trial will enable Australian employees more time to work on the most innovative products, as the offshore R&D will be focusing on support for existing products.
The company intends to grow its profits by 10 to 15 per cent in its full-year results.