Hamish Fletcher

Business reporter for the NZ Herald

MYOB reports flat earnings on increased revenue

MYOB chief executive Tim Reed.
MYOB chief executive Tim Reed.

Accounting software company MYOB's bottom line was flat and revenue up 13 per cent in what its chief executive called a "transformational" and "tremendous" year.

Melbourne-based MYOB, Xero's regional rival, announced revenue of A$246.6 million in the 12 months to December 2013, up from A$217.6 million in the year before.

The company's earnings before interest, tax, depreciation and amortisation was up 14 per cent to A$120.9 million.

Its net loss after tax for the year was A$14.1 million, compared to a loss of A$14.8 million in 2012.

MYOB chief executive Tim Reed called it a "tremendous" year.

"We have never had more active clients than we do today, we've never had more paying clients than we do today and we've never had more clients using our cloud-based solutions than we do today," Reed said.

MYOB said 22 per cent of its paying customers were actively using the cloud at the end of 2013, up on 7 per cent on the year before.

More than 50 per cent of new clients were buying cloud products, Reed said.

"We have really crossed the chasm from being a desktop provider to a cloud-accounting provider," he said.

"We are a company that is investing heavily," said Reed, who mentioned the company spent 20 per cent more on research and development in 2013 than the year before.
"We intend to step that up again in 2014," he said.

MYOB chief financial officer Richard Moore recurring revenue was up 19 per cent on 2012 to 92 per cent.

"One-off" sales were down to 8 per cent of its revenue, he said.

"Which is exactly what we've been planning and hoping to see as we shift our new software sales from one one-off payment into a monthly or annual subscription," Moore said.

He said the company's new products gave it the opportunity to grow its recurring revenue further.

"And we do have the opportunity to monetise the non-paying installed desktop base which we've built up over the last 20 years," Moore said.

MYOB employed 1000 in New Zealand and Australia at 31 December 2013, up from 847 the same time the year before.

Two-thirds of this staff growth came from MYOB's $136 million acquisition of Banklink, which it purchased in May last year.

BankLink's technology helps accountants and businesses automate their transactions with banks and other financial institutions

- NZ Herald

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