JCurve Solutions has lowered its outlook for the 2019 financial year after experiencing “headwinds” in the last half year ended 31 December 2018.
The NetSuite partner is expecting its annual revenue to reach up to $14 million, shaving $1.5 million from its previous forecast.
Revealed in its half year unaudited results, the predictions follow a 13 per cent fall in JCurve’s telecom management expense solutions (TEMS) business and lower-than-expected sales in its core enterprise resource planning (ERP).
Meanwhile its MYOB projects business, which only went live in the third quarter, generated $100,000.
Bruce Hatchman, the publicly-listed company's chairman told shareholders the company’s core Australian operations had faced a number of “headwinds” that had resulted in slower growth and a “requirement for profits to be reinvested for future forecast accelerating growth”.
As such, JCurve has lowered its expected earnings before interest, tax, depreciation and amortisation (EBITDA) from a maximum of $1.4 million to $900,000. Net profit before tax (NPBT) meanwhile is predicted to hit a maximum of $700,000 as opposed to previous forecasts of $1.2 million.
According to JCurve, slower growth in its ERP division stemmed from delays to closing sales of “larger, more complex” NetSuite solutions.
Although the Sydney-based company said the deals were likely to generate stronger future revenue from consulting and reduced customer churn, they were hampered by a longer sales and project delivery cycle.
Of the TEMS division, JCurve said it had reduced customer churn which “assisted with the generation of solid profit returns and maximisation of revenue” despite the sales decrease.
The results come a year after JCurve acquired software firm Riyo Business and less than a month since announcing its intention to buy Spectrum Partner Group, a Singapore-based Oracle NetSuite partner.
Since buying Riyo, JCurve said it was focused on enhancing the firm’s scheduled booking, dispatch and payment (BDP) solution, broadening it to a larger customer base.
The new solution has recently been launched to JCurve’s existing customers, while the company seeks a head of growth to launch it to new customers.
Hatchman added that, following the acquisition of Spectrum, JCurve would review its future sales strategy, with Asia playing a bigger role.