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Hamish Fletcher

Business reporter for the NZ Herald

Diligent expects to make milestone profit

Diligent reported a revenue of $8.2 million for the last quarter of 2011. Photo / FIle
Diligent reported a revenue of $8.2 million for the last quarter of 2011. Photo / FIle

NZX-listed software company Diligent Board Member Services reeled in $22.6 million during 2011 and expects to record a full year operating profit for the first time.

The New York-based company yesterday reported revenue of $8.2 million for the last quarter of 2011, up 165 per cent on the same period the year before.

Diligent makes software allowing executives and directors to manage board documents online and serves more than 1000 public and private companies, with 27,500 users across the globe.

Its total revenue for 2011 was $22.6 million - more than double its revenue in 2010 - and the company recorded its first operating profit during the third quarter of the year.

Sales to new customers reached $20 million over the year, four times higher than new sales in 2010.

Diligent said yesterday it had passed "another historic financial milestone" and expects to record its first full year-operating profit.

Its shares closed up 6c yesterday at $2.41.

Diligent chief executive Alex Sodi said the company was now considering paying a dividend. "Once you start generating cash you can acquire, you can do a lot of things. We've been already reinvesting, so a lot of the questions today have been around dividends ... it's something were going to start looking at.

"There's not a lot you can do these days with cash without a lot of risk," he said.

Diligent was also expecting growth to continue this year, he said.

"We see things continuing to improve, we're replacing the manual way of doing things on paper. We see open fields ahead of us ... the margins are so high, once you pass your costs, it's very profitable," he said.

Part of the Diligent's rapid growth can be attributed to the rise of the Apple iPad, which is one of the devices running Diligent's software.

"[The iPad] is simply a better way of gathering these [board] materials and delivering them," he said.

Diligent experienced strong growth in North America, Britain and Europe over 2011 and was made making headway with government agencies as well as with corporate boards, Sodi said.

Locally, its public-sector customers include the New Zealand Transport Agency.

- NZ Herald

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