After a volatile year, the IT industry received some good news yesterday with a number of companies delivering positive financial results.
VoIP provider MyNetFone managed to produce its first full year after-tax profit of $170,000 after a loss of $1.9 million last year, with earnings before interest, tax, depreciation and amortisation of $233,000 on revenue of $9.8 million.
The company mainly offers VoIP services, but is also venturing into mainstream internet plans, with the firm’s Naked ADSL2+ broadband plans launched in May. Currently, the company has 74,000 customers, compared to 60,000 during July 2008, which chief executive Andy Fund says is due to the increasing popularity of VoIP.
“We are absolutely pleased with this result but there is more to do. The quality of the service and the price is drawing customers, but I think external factors such as tough economic times are making people drawn towards cheaper alternatives such as VoIP and naked DSL.”
“But we will continue improving, and we have specific challenges. Such as getting our deployment times really down pat and smoother, and giving business customers more opportunity and choice in what services they can have.”
But the results weren’t shared by all, with computer and energy services provider UXC failing to report record earnings for the first time in the company’s seven years of operation.
While the company’s revenue jumped 17.4% to $714.3 million for the year ending 30 June, net profit plummeted 43.7% to $13.9 million. Financial director Mark Hubbard says this was due to losing a large body of work without preparing cost-cutting measures at the same time.
“These results are a disappointment, and that has been the writing on the wall from the first half. We entered the year with a pipeline of work, and we were geared up for that, but the downturn caught us out. We didn’t cut our costs as quickly as we needed to, and now we need to address that.”
“The most crucial thing was cost-cutting. We’re getting rid of areas of the business that are non-core and underperforming, and that’s something we’ve always done anyway. It just becomes more crucial now to use capital and resources in the best way.”
Hubbard says the company’s new offerings in solar water heating systems and panel installations should help the company through the next year.
“We also have a few new things like home health checks and installation programs, all under the umbrella of environmental services, so we plan on having a better 2010.”
Meanwhile, M2 Telecommunications has also managed to deliver a strong result, nearly doubling revenue along with an increase of EBITDA and NPAT by 45%.
The company also said its acquisition of People Telecom, and the telecoms business division of Commander, should see the company deliver another strong result next year. The deals contributed over 200 staff and enabled the company to target the SME market.
The company’s revenue increased 86% to $202.7 million, with EBITDA increasing 46% to $13.3 million. Additionally, the company forecasts revenue between $370-400 million and EBITDA between $29-31 million for 2010.
Managing director Vaughan Bowen said in a statement the results were good, and showed how its recent acquisitions have benefited the company.
“The strong financial performance of the Group during another year of marked expansion is again testament to the efforts and talent of our outstanding team. The acquisitions of People Telecom and the Commander telecom assets which we made late in the period have further strengthened our position in our chosen markets, the reach of our sales channels, our underlying earnings and the opportunity for further sustainable growth in the years ahead.”
Finally, finance software provider Bravura Solutions has recorded a drop in EBITDA from $18.6 million to $16.1 million with a fall in revenue from $136.2 million to $135.1 million.
Chief executive Iain Dunstan told the Australian Financial Review the fall in revenue is minimal, and that the company is continuing to perform relatively well despite the effect of the downturn.
“It is hard to say it is a sensational result given that it is dead-set flat, but realistically to weather the worst financial conditions since the Great Depression and see more than green shoots, we are very encouraged.”
“We are right in the area of discretionary spend for financial services companies but are well-positioned to deliver improving operating margins and benefit from opportunities we expect to emerge as the global economy recovers.”
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
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