IBM Australia's 2016 profit takes AU$36m tumble

The local arm of IBM has seen its 2016 profit drop by more than half year over year.
Written by Asha Barbaschow, Contributor

IBM Australia has made its 2016 financial results available to the Australian Securities and Investments Commission (ASIC), reporting AU$16.8 million in net profit, less than half of its 2015 total of AU$53.3 million.

Revenue for the company was AU$3.2 billion -- down AU$316 million from 2015's AU$3.5 billion total -- with gross profit reported as AU$704 million for the 12 months to December 31, 2016.

The local arm of Big Blue paid AU$13.9 million in income tax, compared with AU$28.6 million paid a year prior.

On its balance sheet, IBM Australia noted it received AU$3.4 billion in receipts from customers, and paid its 5,489 employees a total of AU$168 million.

The company also lost 974 employees since its previous filing in 2015.

According to its ASIC filing, the local company and its subsidiaries specialise in the provision of advanced information services, products, and technologies, including the marketing of imported and locally produced information processing equipment, software, and supplies. It also provides maintenance and leasing of that equipment and software and professional services.

During the year, IBM Australia found itself at the centre of the federal government's investigation into the Australian Census debacle.

On August 9, the Australian Bureau of Statistics (ABS) experienced a series of denial-of-service (DDoS) attacks, suffered a hardware router failure, and baulked at a false positive report of data being exfiltrated, which resulted in the Census website being shut down and citizens unable to complete their online submissions.

The ABS said in its submission to the Census Inquiry by the Senate Standing Committee on Economics that IBM failed to adequately address the risk posed to the Census systems it was under contract to provide, and that IBM should have been able to handle the DDoS attack.

"The online Census system was hosted by IBM under contract to the ABS, and the DDoS attack should not have been able to disrupt the system," the ABS said at the time. "Despite extensive planning and preparation by the ABS for the 2016 Census, this risk was not adequately addressed by IBM and the ABS will be more comprehensive in its management of risk in the future."

Days after the botched Census, Australian Treasurer Scott Morrison called out IBM, saying that if it is found responsible for the failure of the Census 2016 website, the federal government will pursue the global giant.

During the calendar year, IBM Australia was awarded dozens of federal government contracts across departments including Department of Defence, the Australian Taxation Office, the Department of Human Services, the Department of Immigration and Border Protection, and the Department of Industry, Science and Innovation.

Globally speaking, IBM reported its 20th consecutive quarter of revenue decline last month, seeing it post five years of slumping figures after peaking at $106.9 billion in 2011 before dropping to $79.9 billion in 2016.

Editorial standards