Jade Software returns $14.9m in share buyback after Wynyard float
Jade Software, the Christchurch-based software developer, returned $14.9 million to shareholders via a buyback after struggling to find compelling new opportunities after the initial public offer of former subsidiary Wynyard Group.
The company's coffers were swelled by the July float of Wynyard, with net cash rising to $30.7 million as at Dec. 31, from $7.6 million a year earlier, according to its annual report, filed with the Companies Office. Jade bought back 24.4 million shares at 61 cents apiece on Feb. 21, about 55 percent of the shares on issue.
Jade was spun out Wynyard as a standalone entity in January last year before the mid-year float when about 64 percent of the company was sold to the public. Wynyard's shares have since soared to $2.33.
Chair Ruth Richardson said the board considered its future strategy in the wake of the Wynyard IPO, weighing up prospects across its lines of business and how much cash was needed to accelerate revenue growth and repay debt.
"In the absence of other compelling business opportunities to deploy the remaining surplus cash, the board determined to return this to shareholders in the form of a $15 million share buy-back," Richardson said. "This return of capital means shareholders will have had the advantage of two liquidity events in recent times, a fitting reward for their patience over the business building years."
The Wynyard float pushed Jade into the black for the first time since 2009, with the group reported a net profit of $7.5 million in the 12 months ended Dec. 31, from a loss of $5.2 million in 2012. Jade made a loss of $8.1 million from continuing operations, with discontinued operations contributing a profit of $15.6 million.
Earnings before interest, tax, depreciation and amortisation plunged 84 percent to $737,000, including a $4.3 million cost from the carving out of Wynyard. Revenue gained 14 percent to $26.5 million.
Jade managing director David Lindsay said the company plans to transform its master terminal unit into "a new logistics company with additional product offerings being brought to market" in 2014, as it seeks to become the world's largest supplier of terminal operating systems to mixed cargo ports.
The company will combine its digital and enterprise units, which provide IT services and support to corporate customers, into one brand, known as Jade Business Solutions, he said.