Reseller News

Channel flattens Oracle result

RELATIVELY flat results for Oracle New Zealand’s last financial year are partly due to it pushing more business through the channel.

Financial statements for the year ending May 31, 2004, made available through the company’s office this month, show little movement in the vendor’s revenue and profits from the 2003 fiscal year.

Oracle’s operating revenue increased by just over $860,000 to $44.49 million, but profits were down by $82,000 to $7.18 million.

Oracle New Zealand country manager Robert Gosling says the overall results are anything but flat, as the company has seen double-digit growth in new licence sales in this period and growth in applications sales.

Consulting and services revenue did not grow however, says Gosling, as the company has been doing more work through channel partners.

Gosling cannot disclose the specific details behind the figures, but says he is pleased with the results, adding the company has seen consistent growth for the last five quarters.

“I can’t talk about the individual details behind the numbers, but we are happy with the figures, especially the growth in licences,” he says.

“We have had many successes in the last year through our partners. They have made a healthy contribution to our results, because of their alignment in particular industries.”

Gosling singles out wins in the health sector where partner CGNZ, the locally-owned licensed affiliate of global consulting firm Capgemini, was awarded a major contract to deploy Oracle’s Accounts Receivable application at the Accident Compensation Commission (ACC).

The organisation meanwhile chose another Oracle partner, Aspirona, to supply it with Oracle’s financials suite and CGNZ also won a contract at the Otago District Health Board.

Gosling says the lack of growth in the services and consulting side of the business is in line with Oracle’s global results for this period.

“It is because of our move to a more indirect strategy. It is a trade-off with the upside being having more sales teams on the ground to increase our new licence revenues,” he says.

Oracle Corporation, the local subsidiary’s parent company, reported growth in both revenue and profits in its first fiscal quarter ending August 31, with revenue from new software licences rising 7% to US$563 million, as services and consulting revenue fell 7% and 11% respectively. Total revenue for the quarter was US$2.22 billion, up 7% from last year’s first quarter with a 16% increase in surplus to $509 million.

For the full 2004 fiscal year total revenue increased 7% to $10.2 billion with profit up 16% to $2.7 billion.

Gosling says the business applications for SMBs Oracle introduced last year did not have a major impact on the results, as sales cycles have been slower than expected.

Only two partners, Asparona and Mi Services, are offering the range at the moment, but Gosling says this is under review and a further one for two partners may be added as uptake of the product increases.

Reluctant to make any predictions on the company’s results come the end of this financial year, Gosling says Oracle has seen consistent growth over the last five quarters.

“Generally, the whole ICT industry [is] reasonably buoyant at the moment,” he says.