IT services provider Empired posted a $15.3 million loss in the last financial year after writing down more than $25 million worth of legacy software.
The Sydney-based company has now launched a “comprehensive review” to cut its overheads and capital investment as its debt hits $14 million.
According to its results for the financial year ending 30 June, Empired posted $176 million in revenue, a one per cent year-on-year increase.
The publicly-listed company cited strong growth of its Microsoft Dynamics business — up 30 per cent across Australia and New Zealand — calling it its highest margin division. Empired was lauded as one of Microsoft's top-performing partners globally at the vendor’s recent Inspire conference.
It also claimed it saw a 65 per cent rise in Cohesion software-as-a-service users, while 63 per cent of revenue came from multi-year contracts.
However, its NPAT, which reached $4.8 million last year, was hit by the non-cash impairment — or write-down — of its software assets that are “now being superseded through new technologies and changes in market trends”.
Despite this loss, the company plans to continue investment in managed services to compete on $200 million of opportunities, Empired CEO and MD Russel Baskerville told shareholders.
“We have invested in the right assets and have positioned Empired to compete and win in this market,” Baskerville added.
“Accordingly, we expect that we will capture our share of the market and deliver long term growth. Our recent actions and a renewed focus on operational improvement are an important reset in the company direction and establishes a strong platform from which to execute much improved operational performance.”
Empired’s revenue for the next financial year is expected to take a $10 million hit after it wasn’t selected as a preferred bidder in the provision of ICT infrastructure and systems services for Main Roads WA.