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Reckon first-half results take a hit

Reckon first-half results take a hit

Reckon’s revenue dipped by six per cent in the first six months of 2018 year on year, hampered by the protracted acquisition deal with MYOB that eventually fell through.

Business Jotham Lian 07 August 2018

In its ASX announcement this morning, Reckon posted a $39.9-million revenue for the six months to June 2018, down 6 per cent from $42.3 million recorded last year.

Its net profit attributable to members came up to $5.2 million, down 5 per cent from $5.4 million last year.

MYOB’s abandoned acquisition deal of Reckon’s Accountant Group, owing to a lengthy and extensive review by both the Australian and New Zealand competition watchdogs, hampered subscription revenue growth, said Reckon.

Reckon’s Practice Management Legal Group suffered from a drop in subscription and was impacted by a “bad debt arising from a new customer signed in the prior year”, recording $0.7 million in earnings before interest, taxes, depreciation and amortization (EBITDA), down 58 per cent from the year before.

Expenditure on product development was also reduced by 7 per cent.

Despite the results, its cloud revenue has continued to grow by 8 per cent, with the number of cloud users now at 51,000.

The board has approved the re-instatement of the dividend policy, and a fully franked interim dividend of 3 cents has been declared and will be paid to shareholders on 4 September 2018.

Reckon Group managing director Clive Rabie remains positive over the future, pointing to several deals that he hopes will open new markets for the software provider.

Earlier, Reckon announced the acquisition of Better Clinics, a practice management software for health, medical and fitness professionals, as it aims to target niche markets and verticals.

Last week, the software provider also signed a partnership with the Institute of Public Accountants (IPA), which will see a white-labelled version of Reckon One being made available to about 35,000 IPA members.

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Reckon first-half results take a hit
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