WebCentral has made a remarkable $2.8 million turnaround for the 2002 financial year, posting a net profit of $440,000, as opposed to the $2.4 million net loss experienced in 2001.
According to Lloyd Ernst, WebCentral's CEO, the managed hosting specialist achieved such financial gains by focusing on building and retaining its existing customer base and continuous product development.
WebCentral chief operating officer Andrew Spicer agreed. "One of the key factors in WebCentral being able to achieve this result is the attainment of a critical mass in customer numbers, which has allowed us to take advantage of scale economies," he said.
"The profit was attained by substantially increasing revenues while holding expenses, an outstanding effort considering we made significant investments in new products, high-calibre additions to the management team, a new enterprise-grade data centre and the high-end corporate division, WebCentral Complex," Spicer said.
While maintaining the same expense levels as 2001, WebCentral launched more than 20 new products in the 2002 financial year, including Asia-Pacific's first "dot-net" offering, a hosted exchange product, a managed database product and a corporate intranet product, DeskControl.
In other financial results for WebCentral:
* Web hosting revenues increased 30 per cent to $22 million from $17 million in the previous year.
* EBITDA increased markedly from $253,000 in 2001 to $3.99 million in 2002.
* A strong cash flow for the 2002 financial year resulted in a 77 per cent increase in cash reserves.