Australian software developer TechnologyOne has been hit by the slowing economy and will shelve plans to enter the North American market.
Australian software developer TechnologyOne has been hit by the slowing economy and will shelve plans to enter the North American market.
While the group hopes government IT investment spending will boost earnings growth of 10% to 15% this year, international expansion is off the cards for now.
But executive chairman Adrian Di Marco says the decision has been “blown out of proportion”.
“It wasn’t a forced move. It wasn’t as if we had already made the decision to go to the US. We were investigating it, and as a result of the economic climate we’ve just put it on hold. It’s a good market for us, but it’s just not a time to go into the US,” he says.
“Our business is very strong here… we’re growing very fast, we’re very confident for next year.”
The group’s figures record a 17% net income rise to $17.2 million for 2007-08 and a 41% jump in revenue to $110.2 million.
Di Marco also says despite the downturn, corporate and government buyers will still invest in software that help save costs and improve efficiency.
“You have to be careful to pick your markets. We’re very focused over the next few years in our existing markets and in industries we believe have resilience to the downturn – local governments, health, utilities, and so on.
“You have to pick the areas where you think the growth will be. Like all businesses, it comes down to picking the right sectors.”
He also says the group may hire up to 200 new employees during the current financial year, but will implement budget controls to monitor its spending. The group will continue international business in Britain.
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