Empired's NZ Intergen unit lifts FY revenue 4% as Cohesion grips govt clients

Thursday 24th August 2017

Australian IT services firm Empired posted a 4 percent increase in revenue from its Kiwi subsidiary, Intergen, as the New Zealand company's Cohesion content management product made headway into grabbing government customers.

Revenue rose to A$64.9 million in the year ended June 30 from A$62.1 million a year earlier, generating earnings before interest, tax, depreciation and amortisation of A$4.7 million compared to $4.5 million in 2015, the Perth-based company said in a statement to the ASX. The New Zealand division also includes Intergen's North American office, which the company said was a drag on revenue and earnings by about A$1 million due to "adverse trading conditions".

Empired bought Intergen in 2014 for A$17.4 million in cash and shares, which it touted at the time as creating the biggest provider of Microsoft-based applications across Australasia. Since then, Intergen one a six-year $12 million contract with New Zealand's Ministry for Primary Industries to provide the Cohesion enterprise content management service.

The Australian company touted the wide adoption of Cohesion by New Zealand government clients as the group's "most prominent and successful" service delivering recurring revenue, where it has increased user numbers to 7,000 as at June 30 from 4,500 a year earlier. Empired will roll-out Cohesion in Australia in the second half of the 2018 financial year.

"The Australian and New Zealand economic climate is robust and provides a solid foundation for a growth business," chief executive Russell Baskerville and chairman Richard Bevan said in their report. "We are seeing a rapid consolidation of our sector in the local market, disrupting the competitive environment and opening many new opportunities to Empired."

The Perth-based firm turned profitable in the year with net earnings of A$3.2 million on revenue of A$167.4 million, compared to a loss of A$1.7 million on sales of A$160 million a year earlier. The board didn't declare a dividend.

The ASX-listed shares fell 0.8 percent to 60 Australian cents, having gained 16 percent so far this year.

(BusinessDesk)

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