rhipe’s (ASX:RHP) Solutions business has clawed its way from a $1.8 million loss in the financial year ending 2016 to a better-than-break even result for the year ending June.
“Our Solutions business is now trading above break even following an operating loss of $0.4 million in Q1 and an operating loss of $1.8 million in the prior year,” the company told shareholders on 24 July, pointing to its unaudited results for the year.
The cloud distributor's Solutions business specialises in delivering Office 365, SharePoint and Azure solutions, providing consulting services, project support and packaged services focused on user experience.
“In last year’s annual report I noted that ‘if FY2016 was a year of significant investment in public cloud, then I expect FY2017 to be the year in which we see the rewards in terms of business profitability’,” rhipe CEO, Dominic O’Hanlon, said. “I am pleased that rhipe has been able to deliver on this promise and I look forward to another great year in FY2018.”
rhipe, which is publicly-listed on the Australian Securities Exchange (ASX), told shareholder that it expected to meet its $4 million reported pre-tax earnings (EBITDA) target for the financial year to 30 June, and has delivered a strong year, ahead of expectations.
The company also said that its licensing revenue growth in the second half was 20 per cent versus 12 per cent in the first half, delivering full year revenue growth of 16 per cent for licensing and 14.5 per cent for the broader group.
Meanwhile, the company saw strong growth in revenue for its public cloud business, which now has 130,000 seats and annual recurring revenue in excess of $22 million.
Broadly, rhipe’s unaudited operating profit for the year was $5 million, a move in the right direction from its break even profit for the prior year.
At the same time, licensing revenue from South East Asian clients grew at 70 percent year-on-year.
“We are very pleased by the strong second half performance of rhipe as well as the strong cash generation delivered at the year end. This provides great momentum to start the new financial year,” rhipe chairman, Mike Hill, added.
The latest results come nearly two months after taking its partnership with Microsoft to the next level, with the vendor appointing the Aussie cloud software distributor as a globally managed licensing partner in June.