Published on the 02/07/2015 | Written by Beverley Head
West Australia based Empired has upped its revenue forecasts for both the last and current financial year after a boost from acquisitions and new customer deals…
Listed IT business Empired, which has a strong Microsoft services focus, has telegraphed a likely increase in revenues for FY2015, up from an initial forecast range of $110-$120 million, to $120-130 million. For the current 2016 financial year the company has indicated revenues could grow as high as $175 million – a growth rate of around 34 percent if achieved.
In a statement to the Australian Stock Exchange the company noted that it had hired around 100 staff to service its organic growth, but acknowledged that the investment in its growth plans was having an impact in terms of expenses and gross margin.
A year ago the company had 430 staff – it now boasts 900 as a result of organic growth and acquisitions. The bulk of the new headcount came from the 2014 purchase of Intergen, which added $60 million to the revenue pot and 370 staff.
In late 2014 the company signalled that it would contest new deals worth $100 million by the end of June. Empired secured the lion’s share of those deals, claiming $65 million of new business was signed in the last six months.
This includes a $12 million six year contract with New Zealand’s Ministry for Primary Industry, a managed services contract with Toyota, a $20 million five year deal to provide application managed services for Rio Tinto and a $15 million five year contract to deliver infrastructure and application managed services for InterOil in Singapore which has prompted the company to establish an office in Singapore.
According to Empired managing director Russell Baskerville, the annuity based managed services contracts provides a strong platform for growth this financial year which enhances; “the defensible nature of our business model and revenue predictability.”
While the New Zealand and Singapore wins enhance the international credentials of the company, its May announcement of the $20 million five year Rio Tinto deal demonstrates the depth of Empired’s portfolio beyond Microsoft. Under the contract it will provide application support and project services for more than 170 applications, including legacy systems, Oracle, Microsoft .Net, SharePoint and CRM systems deployed for managing the miner’s field operations.
With 114 million shares on issue the company is, at time of writing, valued at $A86 million.
