While those technology companies that target the corporate market continue to find it tough going, the small business sector is spending up on IT, particularly when it comes to accounting software.
Both ASX-listed MYOB and Quicken Australia (Reckon Ltd) have announced bumper profits for the six months ended June 30, 2003, and have heralded the resilience of the small business market in Australia as the secret of their success.
MYOB reported revenues of $44.86m, up 20 per cent on the same period last year. The company’s EBITDA profit was $16.23m, up 30 per cent on the corresponding period, but the company wrote down $6.4 million in amortisation of product development among other adjustments, to report a net profit of $4.24 million, a 73 per cent increase on last year's result.
Quicken Australia reported relatively flat revenues ($12.3m), but still managed a substantial (106 per cent) increase in net profit. This increase was mostly due to a driving down of costs across the business by about 13.3 per cent.
Both companies reported that more than two-thirds of revenues were now earned through recurring revenues such as upgrades, support and services – which has given both a positive view of their prospects in coming quarters.