Reckon does share buyback to manage capital base
- 13 August, 2013 10:30
ASX listed accounting software provider, Reckon Limited (ASX:RKN), will be buying back up to 10 per cent, or more than 129 million of its shares as part of the company’s strategy to manage its capital base.
In an announcement on the ASX, the company said it continues to generate “strong operating cash flow” that is sufficient to fund ongoing capital requirements and regular dividend payments to shareholders.
Reckon also announced a net profit after tax (NPAT) of $10.2 million for its half-year results ending June 30, up 10 per cent from the previous half-year results.
Its revenue was also up slightly to $49.5 million, and its earnings before interest, taxes and depreciation (EBITDA) is up 10 per cent to $18.7 million.
Reckon Group CEO, Clive Rabie, attributed the increase to the company’s offerings, including Reckon Accounts, Reckon Docs and Reckon APS, were key factors in the company’s performance in the business division.
“In our view, this represents the strength and stability of our business, and we remain excited about the future growth opportunities that exist in all of our business as a result,” he said.
However, he added the nQueue Billback Division performance was disappointing, mainly as a result of ongoing difficult trading conditions in the US.
“We do however, remain positive that this can be turned around as new products are launched and virtual cabinet opportunities are pursued.”
The virtual cabinet division was acquired in July last year and has delivered an EBITDA increase of 21 per cent from the second half of last year.
Rabie said the result for the half year was also assisted by the profit on sale of its investment in Connect2Field – the investment was acquires in 2012 for $0.7 million and sold for $2 million.
He added that going forward, the group will continue to build on its core strengths and will take advantage of the incremental opportunities presented from the likes of Reckon One, APS private Cloud, and virtual cabinet.