Christchurch-based Jade Software Corporation today reported annual net profit up 3 per cent to $8 million.
Jade reported revenue for the year to the end of December up 7 per cent to $42m.
The privately-owned company said it had spent nearly $30m during the year on product and
market research and development and the acquisition of two new businesses.
Managing director Rod Carr said core revenue from software and services increased by 12 per cent year on year through organic growth and acquisitions but 2007 had fewer one-off items than 2006, so overall revenue growth appeared more modest.
During the year Jade won major new contracts with The Warehouse, Fonterra, Air New Zealand, the New Zealand Electricity Commission, World Vision, Australian Federal Police and the Department of Health and Community Services in Australia's Northern Territory.
The company also acquired two new businesses which would add about 20 per cent to its revenue on an annual basis, Dr Carr said.
The acquisitions, increased investment in product and market development, constrained profitability in 2007.
During the year Jade reinvested 16 per cent of its gross revenue in research and development and about 7 per cent of revenue on market development, and finding and servicing new customers.
Jade's mostly foreign shareholders had invested $25m in the business in December 2004 and had since reinvested 100 per cent of earnings, nearly $20m.
In 2008, revenue was expected to increase as the full year effects of acquisitions flowed through, Dr Carr said.
Projecting profitability was unusually difficult, with the level of the New Zealand exchange rate, uncertainty about the speed at which new business would close, the impact of wage pressures and the timing of major project deployments, all having an impact.
In its annual report, Jade said its board had confirmed the policy of retaining 100 per cent of net profit to reinvest in product and market development.
The board also confirmed that listing on a stock exchange would not happen in 2008.
- NZPA
