Reckon’s move to subscription model drives 17 percent cloud growth

August 9, 2016

Reckon Group’s continued investment in new markets and its focus on growing subscription numbers helped the company deliver a 6 percent growth in revenue to AU$57 million for the half year ending 30 June 2016.

“We have a leading product range in a number of territories and a solid subscription business. Our international expansion has been validated and is showing 11 percent underlying growth. Our results show that we are delivering on growing the size and quality of all our businesses,” Reckon Group CEO Clive Rabie said.

The cloud accounting and legal software firm reported earnings before interest, tax, depreciation, and amortisation (EBITDA) of AU$18.5 million, down 8 percent from the previous corresponding period recorded last year.

Reckon pointed out its existing business EBITDA was 5 percent, however said AU$2.6 million was spent on sales and marketing initiatives for new markets in the half year, which it expects will provide revenue growth down the track.

Despite the lower EBITDA for the half year, the company said it remains on track to achieving its full year EBITDA guidance of AU$34 million to AU$36 million.

The company also outlined it spent AU$11.8 million on development, with more than 50 percent of that was put towards “new market” products.
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