WiseTech Global Limited (ASX: WTC), a provider of software solutions to the logistics industry globally from the information technology sector on 30th April 2019, announced the acquisition of a leading messaging integration solutions provider in Sweden, Xware.
Secure, interoperable messaging solution, xTrade is designed in such a manner that it will help in linking the organisations to their suppliers and partners. This will enable them to share information safely across application-to-application, business-to-business, managed file transfers, business process management and IoT that is important for real-time messaging, queued business flows along with the data integration. The products of Xware are also used in the combination of the complex applications in a specialised sector like defence.
The purchase cost of Xware consists of around $12.0 million upfront, along with a further expected multi-year earn-out potential of approximately $11.2 million in relation to business integration, strategic objectives as well as revenue performance. The company expects that Xware will be consolidated into the WiseTech Global accounts from May 2019.
Today, on 30th April 2019, Richard White, the Founder and CEO of WiseTech Global provided an overview of the business and strategies of the company in the Macquarie Australia Conference in Sydney.
In the presentation, the company highlighted that the logistics industry has an annual revenue of $14 trillion. Even though trillions of dollars are being spent on the technology plus billions wasted on sneakerware/people, the industry is drowning in paper, and high error rates are decimating margins and visibility. At present, WiseTech Global is working towards solving this problem and is well progressed in delivering the operating system for logistics.
CargoWise One is a single-platform software solution designed to surge the productivity. It will also improve integration, automation as well as communication with the supply chain. It will lay a strong foundation for future technology, continuous rollout, scalable capacity and global solutions.
Logistics providers across nearly 130 countries use this technology. The company has more than 12,000 logistics organisations as its customers throughout the world. More than 54 billion data transactions occur in CargoWise One annually with above 4 million development hours over two decades and more than 16,000 valued employees across 40 offices.
38 of the top 50 global third-party logistics providers uses the WiseTech’s solution across 130 countries. Also, 25 of the top 25 global freight forwarders across the world uses WiseTech technology.
The company expects strong growth in FY2019, where revenue will be in the range of $326 million and $339 million, with an expected increase of 47% to 53% as compared to FY2018. The EBITDA is expected to be between $100 million and $105 million, an increase in the range of 28% to 35% as compared to FY2018. Also, read the company’s H1 FY2019 results for more information.
The company is accelerating into more products, more geographies as well as more adjacencies, which will drive the long term growth with each innovation and acquisition.
In the last six months, the shares of WTC have generated a return of 47.32%. At market close on 30th April 2019, the stock of WTC was trading at A$22.380, down 3.117% as compared to its previous closing price. WTC holds a market capitalisation of $7.33 billion with approximately 317.19 million outstanding shares and a PE ratio of 142.59x.
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