Cloud software distributor Rhipe’s operating profit for the first half of FY2021 surged by 34 per cent, year-over-year, to $8.8 million, due mostly to its licensing business.
For the six months to 31 December, the distributor said in an announcement to the Australian Securities Exchange (ASX) that "most of the operating profit increase" for the period was driven by its licensing business.
Indeed, its Microsoft Office 365 licensing count keeps on rising, increasing by 90,000 seats since its 2020 financial year results, coming to approximately 720,000 seats by the end of December last year.
Not only that, but the licensing business also saw costs reduced due to lower headcount, marketing and travel costs compared to the previous corresponding period.
Meanwhile, the Parallo acquisition, which took place in September for at least NZ$4.25 million, contributed to the profit growth in its solution business, according to the distributor. Unlike the solutions business, costs increased in its solutions business due to planned investment and expansion for future growth prospects.
Overall, group revenue growth remained consistent, increasing for the half year by 15 per cent, to A$30.5 million. This half year's revenue growth is in line with the growth seen in its 2020 financial year, which increased by 15 per cent, to A$55.8 million.
However, the announcement noted that this half yearly revenue growth is coming “off a larger revenue base and despite the COVID-19 pandemic”.
“Rhipe’s strong growth continues in Microsoft public cloud products and in our Rhipe solutions business,” the distributor said.
Additionally, its pre-tax earnings were also up, rising by 10 per cent up to A$7.7 million, as was gross profit, which rose by 11 per cent, to A$27.7 million.