Cloud growth boosts Data#3 first half revenue to AU$644m

The company said its AU$6 million profit was fuelled by digital transformation initiatives of its customers in Australia.

Australian business technology firm Data#3 has boosted its public cloud-based revenue by 66 percent during the first half of 2019, with cloud comprising AU$143 million of the company's total AU$644 million revenue.

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Product revenue accounted for AU$532 million of the total revenue reported for the six months to December 31, 2018, while services revenue grew by 11 percent over the same period a year prior to AU$111 million.

Despite gross profit growing 14.7 percent to AU$82.3 million, net profit after tax was AU$6 million, with total expenses itemised as AU$74 million.

Data#3 boasts nine offices across Australia and Fiji, three integration centres, and three data centres.

In presenting its first-half results, Data#3 told the Australian Securities Exchange that digital transformation initiatives underway by customers had boosted its revenue growth.

One such example was working with the Melbourne Cricket Club and the Melbourne Cricket Ground on its digital transformation journey to improve customer experience.

Touching on the project, Data#3 said it provided the organisation with Wi-Fi infrastructure for the facility, as well as real-time customer information, through data and analytics, to improve service levels inside and outside the stadium.

The maintenance agreement includes support for the entire network, back-office, and stadium. Data#3 also provides "customer success activities", using its Hub platform to manage assets, lifecycle management, support arrangements, case-logging, and incident management.

"The market is growing as digital transformation fuels the overall information technology spend, and we have experienced an increase in large project activity and a steady pipeline of opportunities," Data#3 chief executive officer and managing director Laurence Baynham said.

For the year ended June 30, 2018, Data#3 posted AU$14 million in net profit after tax, down from FY17's AU$15.4 million.

Revenue for the year totalled AU$1.2 billion, up 7.6 percent year on year, and was comprised of AU$961 million from its product segment and AU$219 million from services.

Of that total revenue, cloud -- across both products and services -- accounted for AU$267.8 million, up 58 percent over the previous year.

Data#3 was handed a Whole of Australian Government (WoAG) contract by the Digital Transformation Agency (DTA) in March to be the sole provider of Microsoft licensing solutions.

The DTA, on behalf of Australian governments, went to market to find one or more Microsoft resellers to appoint to the WoAG Software Licensing and Services Panel for round three of its agreement with Microsoft.

The Microsoft Volume Sourcing Agreement (VSA3) began July 1, 2016, and will wrap up June 30, 2019.

Data#3 was also charged with replacing the Department of Finance's Govdex platform with a cloud-based file-sharing and "community collaboration" solution, chosen by the department after turning to the government's cloud services panel.


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