Diligent revenue jumps, new customers down

TOM PULLAR-STRECKER
Last updated 13:14 15/01/2013

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Shares in NZX-listed software darling Diligent are up slightly after the company reported its revenues more than doubled to US$43.7 million in 2012.

However, Diligent reported a drop in new customer signings in the fourth quarter - its second consecutive quarterly drop - as new business in the relatively mature United States market declined 15 per cent. 

Its annual revenues were up 143 per cent, while revenues in the fourth quarter rose by a slightly lesser 109 per cent.

The company rents cloud-based software that lets company directors securely access board papers online.

Diligent has enjoyed stellar growth over the past few years, fuelled by the popularity of tablet computers such as iPads among its client base. 

But new sales to fresh customers rose only 5 per cent to US$6.4m in the fourth quarter of 2012, when compared with the corresponding quarter in 2011, and were down from a high of US$7m recorded in the second quarter of 2012. 

They fell 15 per cent in the Americas - Diligent's largest market. That was compensated for by an "exceptional" 398 per cent jump in new sales to Asia Pacific clients and a 36 per cent increase in new business in Europe, the Middle East and Africa.

Diligent said it signed a total of 193 net new client agreements in the fourth quarter, versus 203 in the corresponding period in 2011. It has a total of 1808 clients, which include a quarter of the US Fortune 1000 companies.

The company said it was "well positioned for growth".

Diligent indicated last year that it might soon to start paying dividends. It said in November that it had begun to work with financial advisers in the US to "consider its dividend policy and related capital market matters".

Diligent shares were up 1 per cent during lunchtime trading at $5.55.

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