Australia's first domain name registration company Melbourne IT has announced that its CEO Theo Hnarakis will step down later this year after more than a decade at the helm.
The announcement comes with the release of the company's half year results which showed a 9 per cent year-on-year decrease in revenue to $51.3 million and earnings before interest and tax of $2.5 million, up 4 per cent.
The company posted a $70.3 million net profit following a major restructure to focus on its Australian clients and the sell-off of Digital Brand Services and ForTheRecord for $158.8 million.
It has closed 18 global offices and now has just four remaining in Australian and New Zealand.
The company also paid a special 75 per cent franked dividend of 25 cents on August 22 and is in the process of reviewing a range of measures to provide further capital returns to shareholders.
Melbourne IT chairman Simon Jones said the board remained committed to the SMB and enterprise solutions businesses and that the restructuring process to provide for continued investment has begun.
“The return to a more focused, nimble and principally domestic business will require the central overhead of the company to be brought into line with Melbourne IT’s new size and structure,” he said.
Mr Jones also indicated additional members of the senior leadership team will also step down later this year as the boards looks for the suitable replacement for the their CEO of 11 years.
“Melbourne IT will continue to be in safe hand given the talented group of key executives such as Chief Financial Officer, Peter Findlay, Chief Technology Officer, Bruce Tonkin, and the executives in charge of the SMB and ES divisions, Doug Schneider and Peter Wright.”
The company’s nine-month strategic review has resulted in it discarding computer servers across five data centres it operates in Sydney, Brisbane, and Santa Clara in the United States.
It is now in the process of moving 90 per cent of its customers to cloud computing systems, saving a potential $3 million to $4 million annually. The cloud provider has yet to be chosen, but the company has begun piloting a customer transition to Amazon’s popular cloud servers.
Mr Jones said outgoing CEO Mr Hnarakis had delivered 10 straight years of profits since he took charge of the company in 2002 and the shareholders had enjoyed a shareholder return of 40 per cent per year.
“The board of Melbourne IT would like to thank Theo for his exceptional contribution, huge energy and passion for the business,” he said.