SLI System reports net loss, as expansion costs rise faster than sales; shares drop
By Suze Metherell
Feb 26 (BusinessDesk) - SLI Systems, the retail search engine software company, turned to a loss of $2.3 million in the
first-half, as a 12 percent gain in sales was offset by a 53 percent increase in operating costs. The company’s shares
fell 5.4 percent.
Total revenue and other income was $10.7 million for the six months ended Dec 31, the Christchurch-based company said in
a statement. It did not provide any pro forma numbers but figures from its May prospectus show revenue in the six months
ended Dec. 31, 2012, at $9.6 million. The company had a profit of $795,000 in the year earlier period, according to the
prospectus figures.
Shares in SLI Systems dropped 15 cents to $2.65, making the stock the second-worst performer on the New Zealand stock
exchange All Ordinaries Index today. The stock listed at $1.50 in May.
SLI Systems, which includes Warehouse Stationery and Qantas Airways as clients, listed year to raise capital as it
sought to attract big international retailers as clients. It says its online shopping search engines boost sales, making
it easier for customers to find goods and recommending alternatives.
“The strength of this benefit is illustrated in the strong growth we’ve seen in the number of search queries SLI
services for our customers,” chief executive Shaun Ryan said. “In the month of December 2013 we served in excess of a
billion queries across our global customer base. That was 50 percent higher than the number of queries we served in
December 2012.”
Operating costs rose to $13.3 million from $8.7 million a year earlier. Employee costs rose 47 percent to $7.8 million
as it hired 18 new full-time staff, growing its full-time employee numbers to 137. Its cash balance was $13.6 million.
Annualised recurring revenue, a favoured measure of sales for software-as-a-service firms, rose 26 percent to $21.6
million, with total customers at 445, slightly under its forecast, with a retention rate of 91 percent.
The company affirmed its forecast ARR of $25.9 million for the full year as given in its prospectus. It said it will
continue to chase sales in Japan, and build on existing client bases in Brazil, New Zealand, Australia, UK and US.
(BusinessDesk)