- 31 August 2011 14:10
Empired Ltd Announces Record Results - and successful Cloud Solutionn for John Holland
31 August 2011
EMPIRED LIMITED ASX Announcement:
FY2011 Full Year Results and Commentary
• Record revenue of $39.71M up 42% from pcp of $27.90M • Record EBITDA of $1.28M up 132% from pcp of $0.55M • Positive net operating cash flow of $2.33M • A continued focus on expanding EBITDA margins • Record number of new clients secured during the period • Billable staff grew by over 24% during the period • Victorian region grew by 98% proving our regional growth strategy • Strongest run rate revenue going into July in the company’s history • Strongest forward looking sales pipeline in the company’s history • Strategic investment in rapid growth, high margin cloud computing services • Successful implementation of a fully integrated ERP business platform • Expecting Revenue and EBITDA growth during FY2012
Australian listed IT Services company Empired Limited (“Empired” or “the company”) today announced full year earnings before interest, tax, depreciation and amortisation (EBITDA) of $1.28M, an increase of 132% compared with the previous corresponding period. Revenue grew by 42% to $39.71M, delivering positive net operating cash flow of $2.33M.
Empired Managing Director Mr Russell Baskerville said “We are delighted with both the operational and financial performance delivered during the 2011 financial year.”
“Coming off the back of such a difficult 2010 and a patchy 2011 financial year, this performance not only vindicates our strategy and the underlying strength of our business model but strategically positions Empired for considerable revenue and earnings growth during the current financial year.”
“Revenue grew organically by 42% to $39.71M, a great result, however more importantly we are confident that our investments during the year will ensure a sustainable growth profile with clear strategic focus on growth opportunities in FY2012.”
“We have invested to improve our sales focus and depth across all areas of our business; this has delivered two key benefits and drivers to value for the 2012 financial year. Firstly the level of run rate business is at the company’s highest since inception. Average monthly revenue increased 79% in the last quarter of the 2011 financial year when compared with the last quarter of the 2010 financial year. Secondly Empired’s sales pipeline is stronger than that ever experienced in the company’s history providing confidence in our ability to sustain this growth and continual performance improvement.”
“In addition this investment has resulted in significant growth in Empired’s client base, with new clients secured across Western Australia and Victoria. Typically these clients are high growth medium sized organisations or well established large Enterprise clients within the Resources and State Government sector. This extended client base provides an outstanding growth opportunity during the current financial year at a lower cost of sale.”
Empired has also managed to extend its reach in the Victorian market with revenue growth in Victoria of 98%.
Mr Baskerville commented “Whilst the Victorian market is somewhat subdued in comparison to Western Australia, the sheer magnitude of the market continues to present a great growth opportunity to Empired. We are very pleased that we have managed to achieve significant growth in the Victorian region during a patchy economic environment, particularly in Victoria. This continues to reduce Empired’s regional risk, significantly expand our addressable market and prove our strategy and ability to penetrate regional opportunities outside our head office.”
“We are confident that over the medium term this market will experience significant investment in the IT sector and that Empired will be strategically placed to capitalise on this growth opportunity.”
Empired continues to outline a key strategic objective to grow long term contracted recurring revenue. During the period Empired continued to secure significant increases to a number of its major multi-year contracts with large Government and corporate organisations.
Commenting on contracted recurring revenue, Mr Baskerville stated “We are very pleased that a number of our largest strategic clients have expanded the managed services they receive from Empired. This is a testament to the high quality and value that our clients see in these services and has resulted in yet again an increase in the level of contracted recurring revenue from our major clients.”
“The size and nature of these multi-year recurring revenue contracts will continue to improve Empired’s growth prospects whilst reducing revenue volatility and general risks associated with changing economic cycles. This demonstrates our genuine competitive position in the market and our ability to win major contracts against large national and international competitors.”
Empired has recognised early a fundamental shift in market trends and alternate consumption models for IT services within the Australian IT sector. This has led to the development of Empired’s cloud services offering “FlexScale.”
Mr Baskerville said “Empired’s FlexScale enables a new approach to IT by offering organisations a flexible new range of options for how IT services are designed, delivered and managed. IT services can be packaged into consumable IT ‘products’. These products are offered through Cloud Computing in the form of online service catalogues, in much the same way as using a shopping cart.”
“We expect that this innovation will provide a strong competitive advantage when tendering on managed services contracts and provide Empired with a new stream of long term contracted recurring revenue.”
“We are excited by this new and considerable market opportunity, we are confident in attaining a leadership position in this rapid growth and high margin market.”
Empired delivered EBITDA growth of 132% to $1.28M. Commenting on this Mr Baskerville said “This was a solid result given the considerable strategic investments made during the period.” “Whilst the margins are tight, the investments discussed above will ensure sustainable and continued organic top line growth and value creation for all Empired stakeholders. We continue to be confident that as we drive revenue growth EBITDA margins will expand.”
“Pleasingly, whilst investment was considerable, we did see this during the 2011 financial year with EBITDA outstripping revenue growth by some 3.2 times.”
“Importantly we are very pleased to see the solid financial performance of the previous financial year translate into strong positive net operating cash flow of $2.33M ensuring Empired’s sound cash position.”
“The board remains open to reinstating dividend payments in current and future periods; this will be assessed based on continued strong financial performance, Empired’s funding requirements and the broader economic environment.”
Commenting on the full year outlook Mr Baskerville said “Whilst the broader economic environment continues to experience some volatility, we are confident in an improving Australian marketplace and more acutely in the IT sector within Australia.”
“We are confident our investments will ensure competitive advantage combined with strategic positioning, our underlying business model is proven and remains robust and our strategy is clear. This will ensure Empired is in a great position to capture and capitalise on numerous market opportunities.”
“We have achieved a solid performance during the 2011 financial year and I trust the above commentary demonstrates that we expect an exciting year ahead.”
“We would like to take this opportunity to sincerely thank Empired’s staff and partners for their outstanding contribution to Empired’s growth and success in the 2011 financial year. We would also like to extend our appreciation to our highly valued clients for their trust and ongoing support. Finally to our shareholders, many of whom have continued to support us for some years now, thank you for your patience and confidence. We are excited by the prospects and opportunities that lie ahead and we do believe that the 2012 financial year holds great opportunities for value creation for all of our stakeholders.”
For more information please contact: Russell Baskerville Managing Director Empired Limited Ph +61 8 9223 1234 Em: firstname.lastname@example.org
About Empired Limited Empired Ltd is a national IT Services Provider with a broad range of capabilities and experience. First established in 1999, Empired is a publicly listed company (ASX: EPD) that is proud to have its foundations in Western Australia, with a strong national presence. With more than 200 staff, Empired has built a reputation for service excellence and is a leading provider of business technology solutions in the Corporate and Government sector. Our flexible service delivery approach and “can do” attitude has enabled Empired to secure clients that range from medium size entities through to large enterprise accounts with services delivered across Australia, South East Asia and beyond. Empired focuses on providing companies with tailored IT service solutions that address their specific needs. We have established long-term client relationships and are continually invited to help enhance their business processes. Empired offers a range of services complemented by hardware and software products that enable it to provide comprehensive and professional ICT solutions.
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