Reckon sales remain strong despite downturn

Accountancy and financial software maker Reckon has delivered a 14% increase in profit in its 2008 full-year results and says the next 12 months will be used for expansion.

The company reached its guidance in recording earnings before interest, tax, depreciation and amortisation of $19 million – up $2.5 million or 15% over the previous 12 months. Reckon’s net profit also rose 14% to $11.3 million. 

Revenue rose by 8% to $60.8 million, while operating revenue for the company’s professional division jumped 15% to $21.3 million. The group also says sales from its business division are beginning to pick up, with operating revenue increasing 5% to $38.6 million.

Chief executive Clive Rabie is pleased with the results, and expects revenue to double during the next year after the acquisition of Corporate Services and Billback. Despite the downturn, Rabie says Reckon will continue to scout for smaller acquisition opportunities. 

“We’ve just made an acquisition and we’ll be doing a lot of work in that space. Next year, if we do more, it’ll be little bolt-ons. We’ll definitely be looking at what’s next, though.” 

Rabie says one of the keys to the company’s recent successes is the fact it has stayed so close to its customers. 

“We own all our products, we don’t create third party products, we win market share, we win customers and then we do work for those customers. We have more control over our own business model – that is why we are doing better.” 

Rabie also says the good results are due to a number of new products, including a $29 entry level business package and a “software as a service” product allowing users to host data online. 

But despite the good results, he says it will be a tough year for the industry.

“It’s going to be a difficult year to walk into the company to get them to do a project rather than be a customer provider. I think this year is definitely going to about value and saving money.” 

The company’s shares gained 1.5 cents yesterday to $1.15.