Software folks in general, are just not having the right time globally. Joining that list is Australia-based software company Reckon. The company today declared an increase in revenue by 7% from the AU$91.4 million in 2015 to AU$97.8 in 2016, and a stronger 2nd half revenue growth. That however came, with a sharp 25% drop in net profit after tax, translating to AU$11 million.
With offices in Australia, New Zealand, the United Kingdom, and the United States, Reckon is one of the largest software companies in Australia, providing desktop and cloud-based accounting software for accountants, book-keepers, small to medium enterprises, and individual users. With 800,000+ registered businesses around the world using Reckon software, 70% of these businesses are accounting firms and leading legal firms.
Other significant data from the company’s annual report:
- Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) performance improves in 2016 as revenue grows. EBITDA were AU$35.3 million and development spend was AU$22.8 million.
- Continued growth across all divisions of business with online business user base achieving an 18% increase in growth with 39,000 users, document management achieves a 15% growth with 51,000 users, 617,000 online portal users and lastly, APS seats achieving an 8% growth rate with 92,000 users.
- New markets have generated a revenue of $5.3 million. New products, such as nQueue Billback seem to attract more attention with new clients, projecting a growth of 12% on scan products. It continues to show strong growth, being used by leading legal firms. Additionally, high growth potential markets were invested in.
- Reckon One, the online accounting software has been getting positive feedback and is showing exponential growth on a month-by-month basis.
- Connected services are expanding with new Reckon Loans, which was launched in July.
- Reckon Virtual Cabinet and SmartVault Solutions is performing better than expected, being used by 51,000 users and a 15% user base growth in 2016.
- During the year, content business did not perform as well as expected.
In the official statement, Reckon CEO Clive Rabie states:
2016 has seen a continuation of strong unit-based revenue growth across all the key parts of our business. We enter 2017 with a strong pipeline, which together with our already substantial subscription base, we believe will sustain this growth for this year and beyond.
The market potential here is enormous and hence we intend to continue to invest in these new markets in 2017, for the long-term benefit of the Group. Significant progress has been made towards achieving our development goals in 2016 as we enter the final year of above normal investment in our product line.
This reinforces our ability to continue to deliver top quality and relevant technology to the largest accounting and legal firms in the world and business customers. We remain excited about the potential growth opportunities across all our divisions.