Reckon subscriptions are a AU$31.4m winner

Cloud accounting and legal software firm Reckon has seen a steady growth in its 1H15 revenue, attributing its AU$20.2 net operating cash flow to the company's subscription model move.

Australian software company Reckon has seen a 6 percent growth in revenue for the half year ending June 30 2015 sitting at AU$54 million, recording earnings before interest, tax, depreciation and amortisation (EBITDA) of AU$20.2 million, up 5 percent half-on-half.

CEO Clive Rabie told shareholders that Reckon has made substantial progress in further entrenching the group as a subscription business.

"We see large markets opportunities for many aspects of our business," he said. "This means continuing to invest in people, marketing, and development in the short term to allow longer term revenue and growth."

With three divisions -- Business, Accountant, and International -- forming Reckon Group, the company saw subscriptions account for over 70 percent of each division's total revenue this half, with the company attributing a total AU$31.4 million to subscriptions, growth of 21 percent from the same time last year.

"We are delighted that we have achieved solid growth across the group and been successful in maintaining our focus on building a substantial subscription business on an international stage," he said.

"We have made significant inroads into making Reckon One a contender in the online accounting software space."

In its 2014 results, Reckon posted an 18 percent increase in cash flow, and statutory revenue for the year of AU$100.8 million and EBIDTA of AU$37.1 million, accrediting the majority of its profit to the firm's move to a subscription model.

"We have experienced both strong volume growth and profit growth whilst we have stepped up our investment in the cloud by increasing our sales teams, enhancing our infrastructure, and investing in product development," the CEO said at the time. "We have also successfully improved our working capital, largely as a result of moving to a subscription business."