Aqua Online, the JSE-listed focused e-services provider, has reported attributable earnings of R10,4 million for the 6 months to December 2000, 416% ahead of the R2 million reported in its previous corresponding interim period to December 1999.
[VIDEO]Interim revenue of R36,2 million exceeded R8,9 million for the corresponding interim period to December 1999 by 309 %, while earnings per share (EPS) of 3,97 cents were more than double the 1,65 cents for the same period to December 1999. EPS, if annualised for the full trading year to June 2001, is also well ahead of EPS of 4,21 cents for Aqua`s maiden 12 months to June 2000.
Brent Shahim, joint CEO of Aqua Online, says that Aqua`s success contrasts the increasing 'dot.com` fallout and negative sentiment towards technology companies. "Firstly we have strong cash flows," says Shahim. "Unlike many technology companies our growth is funded entirely by revenue generated from day-to-day business operations.
Secondly, more than 90% of net income is generated in US Dollar and Pound Sterling. As we leverage our South African skills and cost bases to service our offshore clients, we consistently maintain a favourable cost to revenue ratio. And with 81% of pre-tax profits annuity-based, the Group has strong, repeat 'annuity type` cash flows, " he says.
[VIDEO]Shahim adds that the Group`s ability to manage growth distinguishes it from other industry players. "Our exponential growth over the past year-and-a-half has taken place within the constraints of strict financial discipline," he says.
He points out the integral role which Aqua`s people have played in the Group`s continued success. "Since year end in June 2000 the team has increased from 98 to 130. We are constantly working at capacity and therefore seeking quality resources. But we make sure that each new member of the Aqua team matches the enthusiasm, innovation and sheer energy of the rest," he says.
[VIDEO]Aqua projects future growth in the online leisure and gaming market, to which it offers specialist e-services expertise. "Statistics confirm that this is the Internet`s fastest growing industry," says Shahim. "Our online gaming infrastructure is exceptionally scalable which enables Aqua to offer additional services to our existing clients and to take on new clients, without compromising the quality of existing services. And revenue is continuously boosted by our lucrative transaction participation model. Clients using this pricing structure have shown exponential growth to date, and by continually adding new clients to our portfolio we further dilute potential risk."
UK-based joint CEO, Tal Harpaz, says: "Merrill Lynch recently estimated the global online gambling market to be worth lb580 billion, while the online gaming market in the UK will be worth in excess of lb123 billion by 2015. Aqua`s experience in servicing the online leisure and gaming market from its inception has positioned the Group to capitalise on this lucrative growth opportunity.
In addition the increasing move by corporates from e-strategy to e-business implementation will continue to generate demand for the services offered by both our enablement division in Johannesburg and our administration division in London," says Harpaz.
"The six months ahead look extremely positive for the Group with a substantial order book in the enablement division and an increase in clients and client performance on the administration side. Our proven business strategy will ensure that we continue to maintain momentum and enhance shareholder value," he adds.
Aqua Online is a fully integrated group of SA-based and international operations, which provides end-to-end e-commerce related services across the e-services continuum. These range from e-strategy consulting, front-end web design and back-end software development and integration, to online security services, 24/7 hour multilingual (European) call/e-mail centre support, international multi-currency payment gateways, off-line processing services and multi-location international web hosting.
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