Xero beats sales target

Last updated 11:10 04/04/2014

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Xero shares have risen 2.2 per cent to $38.00 in early trading today after it reported an 83 per cent rise in annual revenue to $70.1 million.

A strong fourth quarter saw Xero just beat the target it announced in August of growing its sales by more than 80 per cent in the year to the end of March.

The company said it expected its net loss would be about $35m, up from $14.4m last year. Forsyth Barr had upped its forecast of Xero's annual loss by $6.3m to $41m in November, so the final figure looks like it will be in line with its original forecast.

The strong New Zealand dollar had adversely affected reported operating revenue because two-thirds of its sales were overseas, Xero said. On a "constant currency basis" Xero's sales grew 92 per cent.

Xero added 376 employees during the year, taking its workforce to 758.

The value of its subscriptions on an annualised basis had risen to $93m by the end of year. Of that $41m were generated in Australia, $29m in New Zealand, $14m in Britain and $3.3m in North America. It said it was now turning its focus to the important United States market.

Xero had received "US industry recognition", for example being named among Accounting Today's 2013 "top new products", it said.

Some of the heat had come out of Xero's share price in recent days, with the stock closing yesterday at $37.20, down almost 20 per cent on its record high of $45.99.

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- Fairfax Media

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