Retail software solutions and services provider UCS Group today announced that its revenue for the year ended 30 September surpassed R1 billion, for the first time.
The company says in a statement that 86% of revenue came from the sale of its own products and services, rather than the sale of third-party products.
Earnings before interest, taxation, depreciation and amortisation (EBITDA) grew by 64%, to R249 million, while headline earnings per share grew by 61%, to 34.7c. The group says its normalised EBITDA margin rose by 43%, coming in at 16.4% of revenue.
In addition, solid cash flows - attributable to a focus on the generation of annuity revenue (55% of total revenue) - resulted in a 49% increase in the cash generated from operations, to R179 million. A final dividend of 5c per ordinary share has been declared.
According to the UCS statement, organic growth accounted for 16%, with the balance attributable to the effect of current year and prior year acquisitions, including Lifeworld, DiverseIT, TSSMS and Quadrant.
"The group has recorded another set of excellent results, with all business units performing in line with, or exceeding expectations in terms of trading results for the period. We expect this trend to continue into the new year," says CEO John Bright.
The company`s solutions and services division achieved a top line growth of 48%, through a combination of organic growth and corporate activity, as a result of the acquisition of controlling interests in the Lifeworld and DiverseIT businesses.
The groups says that, on the software front, its strategy to consolidate the businesses acquired historically into a larger, more cohesive unit, trading under the UCS Software brand, continued to deliver the planned benefits of improving margins. This reflected a 16% top line growth for 2007, translating into a 36% increase in normalised PBIT achieved.
In September, the group "unbundled" ARgility, a business created to compete in the international markets. This initiative included the sale of the Active Retail and Dolfin product suites.
UCS says it has signed a deal to purchase 100% of Aquitec, for $6 million. "With operations in the UK and US, Aquitec offers an opportunity to acquire IP relevant to a retail specific customer base, as well as an established offshore infrastructure with IT skilled personnel, through which the group could leverage its South African-based skills, products and IP."
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