Enterprise software provider TechnologyOne has survived the pandemic, reporting a 4% rise in revenues for the year to September 30 to $299 million and an 8% rise in net profit to $62.9 million.
The company said revenue from its software-as-a-service (SAAS) business and ongoing business was up 12% to $269.8 million for the year.
Underlying profit before tax came rose 13% to $82.5 million and within guidance of 8% to 12% growth for 2019-20.
The company said the improved performance was driven mainly by its software-as-a-service (SaaS) business which saw revenues jump 32% to $134.6 million for the full year. The 32% full year was up 22.1% from $110.2 million at the halfway mark.
TechnologyOne said thanks to strong cost controls, its reported cash flows grew solidly in the year.
It generated cash flow of $66.4 million, up 49% year on year. That saw cash and cash equivalents rise 19% to $125.2 million by the end of the year.
Because of the solid year and balance sheet directors declared a full-year dividend of 12.88 cents a share, up 8% from 2018-19.
Management is expecting to see strong continuing growth in SaaS ARR and profit in FY 2021. Though, it stopped short of providing any firm guidance.
It also spoke very positively about its long term growth potential.
Looking to the new financial year the company said its software as a service business “continues to grow quickly, the quality of this revenue stream is exceptionally high, given its recurring contractual nature, combined with our very low churn rate of less than 1%. Today our Total Annual Recurring Revenue (ARR) has hit $222m and is set to exceed $500m in the coming years.”
Management was equally positive on its earnings growth prospects.
“Underlying Profit Before Tax margin increased to 29%, compared to 27% pcp. We see margins continuing to improve to 35%+ in the coming years driven by the significant economies of scale from our single instance multi-tenanted Global SaaS ERP solution. We are on track to double the size of our business once again in the next five years,” the statement concluded.
The shares were up 0.4% at $9.04.