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Gentrack lifts first-half profit 23% as UK sales jump

Thursday 26th May 2016

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Gentrack Group lifted first-half profit 23 percent as sales from its UK division jumped with the signing of new customers and the software developer says annual revenue will climb at a faster pace than previously signalled. 

Net profit rose to $3.8 million, or 5 cents per share, in the six months ended March 31 from $3.2 million, or 4 cents, a year earlier, the Auckland-based company said in a statement. Revenue climbed 26 percent to $23.3 million with sales from its UK division up 80 percent, outpacing a 16 percent lift in Australian sales and 13 percent rise in New Zealand revenue. 

Gentrack expects revenue to rise at a 20 percent pace this financial year, more than the 10 percent-plus increase flagged at last year's annual meeting and is predicting earnings before interest, depreciation and amortisation to be about $15 million in the year ending June 30, up from $14.5 million in 2015. 

In presentation slides accompanying the release, the company said it was still "confident of long-term growth driven by Australian and UK market opportunities and structural reforms in power and water sectors" and "continue to explore acquisition opportunities." 

The board declared an interim dividend of 4.2 cents per share, payable on June 21 with a June 10 record date, up from 4.1 cents a year earlier. 

Last year Gentrack replaced its chief executive James Docking with a former Oracle and SAP executive Ian Black, who started with the software firm in January. 

The shares last traded at $2.65 and have gained 6 percent so far this year. The stock was punished after releasing a major profit warning six weeks after listing but has recovered since September last year and is now trading above its 2014 initial public offering price of $2.40.

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