Enterprise resource planning (ERP) software-as-a-service (SaaS) vendor TechnologyOne has recorded its fourteenth consecutive year of record revenue and profit growth, rising by 17 per cent and 16 per cent, respectively.
This comes to $429.4 million and $102.9 million, respectively, for the year to 30 September, according to the vendor’s financial results for 2023. Annual recurring revenue (ARR) grew by 23 per cent to $392.9 million, making up roughly 90 per cent of total revenue.
TechnologyOne CEO Ed Chung said the growth in ARR, and profit was “driven by the significant value proposition of our global SaaS ERP solution for new and existing customers”.
As a result of the successful year, the company brought forward its goal of passing $500 million ARR by FY25, one year earlier than expected.
“With strong results and a confidence in our sales pipeline, we made additional investments in all our pillars for growth to enable us to continue to double in size every five years beyond $500 million ARR,” Chung said.
In the local government sector, over 25 major deals were closed in FY23, coming to more than $113 million in contract value. Meanwhile, in the government sector, there were five major deals worth more than $23 million in total.
The UK business unit's ARR rose 52 per cent, to $26.5 million, with profit up to $3.7 million. Additionally, $2 million was spent towards due diligence and putting forward a non-binding and indicative proposal to acquire a UK-based higher education software provider. However, after “significant and disciplined due diligence”, the vendor did not go through with the deal.
“TechnologyOne remains in a strong position to explore other appropriate M&A [merger and acquisition] opportunities in the near and medium term given the company’s strong balance sheet,” the company added.
This marks TechnologyOne’s fourteenth consecutive year of profit and revenue growth follow its half-yearly result back in May, which saw profit after tax jump 24 per cent to $41.3 million while total revenue was up 22 per cent to $210.3 million for the first half of FY2023.
Also in May, the company flagged a cyber security incident into its back-office system and appointed “third party experts” as part of its investigation.
A few days later, TechnologyOne confirmed via the experts that its platform wasn’t affected, was secure and there was no further illegal activity detected.