​Doubling of cloud revenue to thank for Data#3's AU$14m net profit

Public cloud-based revenues were up 58 percent for the year, bringing in AU$267.8 million in revenue for FY18.

Data#3 has reported its financial results for the year ended June 30, 2018, posting AU$14 million in net profit after tax, down from FY17's AU$15.4 million.

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Revenue for the year totalled AU$1.18 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.

Gross profit for Data#3 was AU$160 million.

At the end of the 2018 financial year, Data#3 boasted 4,867 transacting customers.

"We had a particularly challenging first half due to a number of one-off events, primarily in the services segment, which resulted in a material shift in profit to the second half," Data#3 CEO and MD Laurence Baynham said.

"We are pleased to have achieved a significantly improved second-half performance, which largely recovered the first-half shortfall, but fell short of our full-year objective to improve on FY17 earnings."

Included in the company's earnings are the results from its Discovery Technology and Business Aspect acquisitions.

Data#3 chair Richard Anderson said the contributions from both companies were "lower than expected", and said Data#3 is "taking significant actions with a view to improving the financial contributions of both businesses in FY19".

Discovery Technology specialises in software development, network integration, and VoIP. Data#3 increased its shareholding of the company that operates independently to 77.4 percent in July last year.

Business Aspect, meanwhile, which was scooped up by Data#3 in 2014, suffered a first-half loss that impacted its full-year result, the company explained.

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. Just over a year in, the DTA flagged a need for the services of one or more vendors to provide services to entities participating in the VSA3 arrangement.

The operation of the panel will be reviewed annually by the DTA and may be refreshed or reopened to add additional or different panellists, categories, or deliverables.

Data#3 in January announced that it would be 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.

The software-as-a-service solution on the public cloud using Microsoft Office 365 and Microsoft Azure will set the department back AU$656,524.

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