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INTEGRATED RESEARCH LIMITED — Earnings Release 2010
Aug 11, 2010
65142_rns_2010-08-11_c6b88364-e689-45e2-9755-51cb0d712821.pdf
Earnings Release
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Integrated Research Ltd > ABN 76 003 588 449 Level 9, 100 Pacific Highway, North Sydney NSW 2060 Australia t: +61 (2) 9966 1066 f: +61 (2) 9966 1042 e: [email protected]
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MARKET RELEASE
Integrated Research Limited announces results for 2010 financial year
Sydney, Australia, 12 August 2010 - Integrated Research (ASX:IRI), leading developer and provider of systems and application management solutions for high availability computing environments, today released the following results for the financial year ended 30 June 2010.
The Company achieved an annual net profit after tax of $5.4 million, compared to the equivalent prior period of $7.9 million which is within the guidance provided to the ASX on 2 July 2010. Revenue for the full year was $37.3 million representing a 13% decline over the prior year, mainly attributable to a stronger Australian dollar. In constant currency, revenue was down 3% compared to the prior year.
Revenue derived from the Company’s IP Telephony (IPT) products continued its strong growth. Even with the stronger Australian dollar, new licence sales for IPT were up 14% over the prior year with growth reported in all geographic regions. This was a watershed year for the Company with IPT now being the largest source of new licence sales.
Total revenue was impacted by lower than anticipated HP NonStop sales. However, the product line showed improvement in the second half with 10% increase in new licence sales in the US over the same period last year, in line with improved economic conditions globally.
Steve Killelea, Chairman of Integrated Research said, “Although the net profit after tax is lower than the prior year, the underlying fundamentals and strategy of Integrated Research remain sound. The Company has captured a leading position in the global management of IP Telephony systems with over 4 million phones licensed, and with our expansion in the management of payments systems which will underpin growth.”
Revenue from consulting services increased by 19% over the prior year to $2.0 million despite unfavourable economic conditions, which validates the Company’s strategy to invest in this business segment.
The Company continued to focus on expanding its capabilities and productivity. The number of staff increased by 13% from 142 to 161. Total expenses were $31.6 million, down 5% against the equivalent prior year which was attributable to the strong Australian dollar.
Performance monitoring software for business-critical systems
Research and development expenditure of $8.3 million was 22% of total revenue and in line with historical averages. This has been underscored by significant improvement in research and development processes, better product quality and improved customer satisfaction. The company is committed to maintaining and improving its core strategic strength and we expect a comparable level of investment in research and development in the future.
The financial highlights are as follows:
| Financial result highlights ($’000) | 2010 | 2009 | % Inc/(dec) |
|---|---|---|---|
| Revenue from licence fees | 17,386 | 21,723 | (20%) |
| Revenue from maintenance fees | 16,846 | 19,217 | (12%) |
| Revenue from consulting | 1,999 | 1,685 | 19% |
| Revenue from other activities | 1,072 | 59 | |
| Total revenue | 37,303 | 42,684 | (13%) |
| Research & development expenses | 8,347 | 8,244 | 1% |
| Sales, consulting & marketing expenses | 19,197 | 18,932 | 1% |
| General and administrative expenses | 4,054 | 6,142 | (34%) |
| Total expenses | 31,598 | 33,318 | (5%) |
| Net profit beforeincome tax | 6,046 | 9,820 | (38%) |
| Net profit after income tax | 5,401 | 7,863 | (31%) |
General and administrative expenses decreased by 34%. This was mainly attributable to a one-off expense in the prior financial year for a review of the Company’s strategy with the Boston Consulting Group.
Mark Brayan Chief Executive Officer of Integrated Research added, “We are pleased with the level of IP Telephony growth which continues to be a strong performer. We established some significant strategic alliances with ACI Worldwide and Stratus Technologies in recent months. We are looking forward to leveraging these alliances to build and re-position our NonStop, Payments and Distributed Systems product lines to attract new customers, the Company has hired new staff to improve our capabilities and underpin future growth.”
Integrated Research continues to be in a strong financial position, with cash at 30 June 2010 of $8.4 million and remains free of debt.
Directors have declared a final dividend of 1.0 cent per share partially franked to 45% payable on 17 September 2010, bringing the total dividend for the year to 3.0 cents per share.
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Performance monitoring software for business-critical systems
About Integrated Research
Integrated Research (ASX:IRI) - the people behind PROGNOSIS - is a publicly listed software company with a 21-year heritage of providing precise performance monitoring solutions for business-critical computing and IP telephony environments. The company services customers in more than 50 countries through direct sales offices in the USA, Europe and Australia, and via a global channel-driven distribution network. Customers include the world’s largest bank, telecommunications company, aviation company, stock exchange and computer hardware manufacturer.
For more information, visit www.prognosis.com
Press Contact: Mark Brayan CEO Integrated Research +61 2 9966 1066 [email protected]
Performance monitoring software for business-critical systems