CSG records AU$28.5m profit, announces AU$13.5m acquisition

Australian-listed CSG has reported AU$28.5 million in profit for the 2015 financial year. On Monday morning it also told shareholders of its upcoming AU$13.5 purchase of CodeBlue, and its partnership with global cloud services firm, 8x8.

Print solutions provider cum IT services firm CSG has reported full year earnings before interest, taxes, depreciation, and amortisation (EBITDA) of AU$28.5 million, up 20 percent year-on-year.

The Northern Territory-based company also recorded AU$224.3 million in revenue, up 13 percent from FY14's AU$199.3 million, with an operating cash flow of AU$22.5 million, up from AU$13 million at the same time last year.

CSG said that less-traditional, non-print sales represented more than 8.5 percent of its equipment sales revenue in Australia.

"This year we have executed on our strategy to expand our portfolio of products and services to include non-print offerings," CEO Julie-Ann Kerin said.

"In 2H FY15, 10 percent of all of our deals in Business Solutions Australia included the sale of non-printed technology."

CSG told shareholders that it intends to raise in excess of AU$30 million to fund the upcoming acquisition of New Zealand-based SMB IT service provider, CodeBlue, and to "pursue near term growth opportunities". The acquisition will see CSG pay AU$4.5 million in cash, with an additional AU$9 million to be paid in contingent cash payments dependent on CodeBlue's FY17 financial performance.

On Monday, CSG also announced a partnership with cloud unified communications provider 8x8, which would see the California-based company expand its Asia-Pacific presence.

As a result of the partnership, CSG will serve as a channel partner for the Australia/New Zealand region, charged with distributing 8x8's enterprise cloud communication solutions.

"The growing demand for enterprise cloud communications in key international markets such as Australia and New Zealand has become critical for our customers," 8x8 CEO Vik Verma said.

"CSG has a broad footprint across Australia and New Zealand, enabling us to offer a highly innovative enterprise cloud communications solution to a broader customer in one of the fastest growing technology hubs for enterprise communications."

Over the course of the financial year, CSG said it won three print-as-a-service contracts, with a value of AU$40 million, over five years.

The company also said that it has AU$285 million worth of Australian enterprise solutions contracts in the pipeline for FY2016.

Following the sale of its Technology Solutions business to NEC in July 2012 for AU$227 million, CSGs enterprise solutions business had been restrained from competing in the IT managed services sector. On July 3 2015, the restraint was lifted and CSGs enterprise solutions business began preparing to re-enter the IT managed services sector, with the company telling shareholders it will focus on Tier 2 Enterprise, government, and education.

"The same product suite that will be the platform for the delivery of technology-as-a-service in the business solutions business will scale to deliver a robust and scalable platform to deliver enterprise IT managed services."