ASX-listed Straker Translations edging towards profitability

Grant Straker, co-founder of Straker Translations. Photo / File

Newly-ASX-listed Straker Translations says it's on track to achieve its full-year prospectus forecasts, after two European acquisitions and strong organic growth in the first half.

But it hasn't yet got itself into the black.

Straker uses cloud technology to farm out translation work around the world, from its base in Auckland. It listed on the Australian stock exchange in October, raising $20 million.

The company lifted translation revenue to $12m for the six months ended September, up almost 40 per cent from $8.6m for the same period in 2017, chairman Phil Norman said.

Norman, formerly chair of online accounting company Xero, joined Straker in September, just before the ASX float. Xero is another Kiwi company listed only on the Australian exchange.

Norman said the translation company cut its losses to $220,000 for the half, as against $1.06m the year before, and it was in the black when it came down to ebitda.

"On an adjusted ebitda basis, the company generated a profit of $110,000 for the first half, a significant improvement on the adjusted ebitda loss of $786,000 for the same period last year," Norman said.

On a pro-forma basis, revenues for the first half were $13.4m versus the prospectus forecast for the year ending March 31 of $24.9m. The company remains on track to achieve the year-end pro-forma revenue forecast, Norman said.

During the half, Straker bought translation operations in Spain and German, each with annual revenues around $3.2m. Bringing them onto the Straker RAY translation platform would allow the company to leverage customer relationships and grow revenue, Norman said.

Meanwhile, the company is looking at other acquisition opportunities in Europe and the US, he said.

Straker was founded in 1999 by Merryn and Grant Straker.

Grant spent six years as a British army paratrooper before returning to New Zealand and forming the translation company.

Straker Translations listed on October 22 at A$1.51 a share and the price rose to A$1.76 on the first day. The stock lost 0.7 per cent after today's result to A$1.49, fractionally below the listing price.