Brazilian software firm Totvs has reported a revenue drop of 3.5 percent to R$2,2 billion ($707 million) in 2016.
The company - the largest provider of enterprise resource planning (ERP) systems in Brazil - has suffered with poor financial performance in all quarters last year, compared to historic yearly growth of 10 percent.
Traditionally a popular choice when it comes to ERP within the small and medium enterprise segment in Brazil, Totvs has had some fierce competition from rival SAP.
The German firm has been aggressively targeting Totvs's sweetspot with its cloud-based back-office products and reporting double-digit growth within that segment.
Totvs has traditionally focused on the Brazilian market and the poor results are attributed to the recession the country has weathered over recent years.
Another reason for the revenue drop at the company is the recent shift to cloud-based provision, which was expected to cause an initial impact to the financial results.
However, the Brazilian firm was keen to stress that there has been some progress in the subscription earnings - 21,4 percent growth in relation to 2015 with some 4,000 new clients added to the Totvs portfolio.
"The evolution of the subscription base observed in the last 18 months, combined with the investments made by the company and the opportunities of the Brazilian market, gives us the confidence that we are on the right track to resume growth and profitability in 2017", says chief executive at Totvs, Laércio Cosentino.
2016 was a tumultuous year for Totvs, both in financial terms but also from a leadership standpoint. The company had appointed Rodrigo Kede Lima, who joined from IBM to lead its expansion in international markets and gradually replace Cosentino, but the executive decided to step down only a few months later to re-join the Big Blue.