In the annual general meeting of Hansen Technologies Limited (ASX: HSN) held on 22 November 2018, the chairman David Trude addresses its shareholders the financial performance of the company. The agenda of the AGM was chairman’s address followed by a presentation by the CEO Andrew Hansen and highlights of the formal business.
The key financial measures made a record this year. There was an increase in revenue by 32%. The revenue generated in FY2018 was $230.8 million. The EBITDA was reported to be $59.3 million which shows an increase of 29% this year. The net profit after tax increased by 35% which is equivalent to $38 million. The EPS increased by 26%. The key driver for the increased revenue was the acquisition of Enoro Holdings A/S with effect from 1 July 2018 contributing a revenue of $57.7 million.
After the acquisition of Enoro Holdings A/S, the revenue generated is based on two parameters i.e. revenue by vertical and revenue by geography. Through revenue by vertical, Energy contributed 59% of the revenue as compared to FY17 where energy generated 43% of the total revenue. On the other hand, the second parameter revenue by geography, the EMEA region generated 54% of the total revenue.
The dividend declared in the FY2018, were the balance of distributing franking credits as well as clearing debts. This not only enabled the company to maintain flexibility to fund any further strategic and value creation acquisition but also strengthen the balance sheet of the company.
As the AGM proceeded further, the CEO highlighted the operational activities of the company in FY2018. He states that the Enoro Holdings A/S acquisition was the biggest acquisition within 10 years of time. The company also launched a new unifying brand HabsenCX. In Finland and Sweden, the company introduced its first Go-Live of Enoro Holdings A/S CX billing system. Further, the company cross-sells its new utility analytics SaaS product to multiple clients across the Nordics. Further, upgraded the billing system for US municipalities. Regional Presidents were appointed in order to strengthen the management team. Meanwhile, Vietnam development centre was also developed. Vietnam, which was considered a relatively unused market with the high availability of highly skilled resources. Also, the time zone of Vietnam matches well with HSN’s other development centres. This development centre was established in the month of September 2017, with only 5 people who were doing the test work. By now this strength has increased and reached a total strength of 50 people who are performing the development work.
The recurring revenue which comprises revenue from maintenance, support, dedicated services, and the license income stream generated 65% of the total revenue. Hansen is committed to delivering shareholder’s value. In order to create value for the shareholders, the company provides a solution to the clients as per the changing business needs. They also undertake strategic acquisition to enter new market segments. The company also influences their global experience by sharing knowledge related to product development across various markets, global view of security and what methodologies to adopt for software development.
For FY2019, the company will maintain a similar guidance as FY2018. The reason being the higher recurring revenue. They expect a slight low non-recurring revenue as a result of partial termination by US of an underperforming call centre contract within US solution business. The total revenue in FY2019 is expected to be comparatively quiet.
Since morning the market price of the share has gone up by 2.174% and is currently trading at A$3.29 (AEST: 1:58 pm, 22 November 2018) with the market capitalization of A$634.51 million and PE ratio of 21.76x.
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