Three businesses acquired by Dreamscape Networks (ASX:DN8) in 2017 -- Vodien Group, Enetica Group and Net Logistics -- have contributed $6 million towards the company’s total revenue for the six months ending December 2017.
The publicly-listed domain registration, hosting and online solutions provider released its latest half-yearly financials on 22 February, reporting a 30 per cent year-on-year boost in revenue compared to the same period the previous year, to $29.3 million.
At the same time, the company reported net profit after tax (NPAT) for the period of $752,000, up from the $14.3 million loss it reported for the same period the year prior – a result of $16 million in “forgiveness of advances to related parties”.
“As reported in the half-year financial report for the six months to 31 December 2016, advances to vendors, being the shareholders of Pandora Enterprise Holdings Ltd, amounting to $16.05 million at the date of the acquisition, were forgiven upon acquisition of Pandora Enterprise Holdings Ltd,” the company said in its latest financial report.
The latest results come as the company launches itself headlong into its ongoing strategic transformation from a domain registry business to a full-blown hosting and cloud services provider – a move supported and accelerated by numerous acquisitions over the past couple of years.
“Dreamscape’s first-half results reflected a period of substantial transition,” the group’s CEO and managing director, Mark Evans, said.
“While the financial result was lower than anticipated, the company is profitable, generating positive cash flows, and absolutely committed to its focused South East Asian core growth strategy, which is the right strategy to drive long term growth in shareholder value.
“The Crazy Domains brand in Australia continued to increase its total .au domain market share, despite weak market conditions in the first half, and remains Australia’s number one domain brand,” he said.
According to Evans said that, underpinning the company’s core South East Asian growth strategy was Vodien Internet Solutions, which has performed well since its acquisition in July 2017, and is now the number one .sg domain name, from number three at acquisition, and the number one hosting provider.
“The strong performance of Vodien under Dreamscape’s ownership, and the benefits that will be translated across other parts of the company, highlight the strength of Dreamscape’s core South East Asian growth strategy,” Evans said.
However, the company saw flat market conditions in Australia, with industry growth flat over H1 FY18 despite low single-digit expectations. Meanwhile, bookings were lower than anticipated.
The company told shareholders it would rationalise the data centres of Enetica and fellow acquisition target, Quadra, into its own Sydney facility.
It also reiterated that it would streamline operations into the company’s new Singapore headquarters, closing its Perth and Dubai offices as well as its Indian support centre.
The company revealed in early February that it would close at least two of its offices and consolidate other parts of its operational footprint, as it works to minimise mounting costs.