SLI System reports smaller annual loss, more cash than forecast
SLI Systems [NZX: SLI], the search engine software developer which debuted on the NZX last year, posted a smaller than forecast loss while keeping more cash on hand.
The Christchurch-based company reported a loss of $5.7 million in the 12 months ended June 30, below the $7.2 million loss forecast in its offer documents in May last year, it said in a statement. Operating revenue was $22.1 million, about matching its forecast for $22.2 million, while cash reserves were $11.4 million, versus the $7.3 million flagged in its prospectus.
Annualised recurring revenue, SLI's preferred financial measure, rose about 29 percent to $24.9 million, missing its forecast of $25.9 million, but in line with its profit warning in July. SLI had 511 customers at June 30, compared to the 581 it had forecast in its prospectus, but said the initial deal size for new customers was 20 percent larger than forecast.
SLI is forgoing profit and reinvesting earnings to fund its growth plans, as it hopes to capitalise on the growing e-commerce market, particularly in the US, and says its software as a service is the second biggest after Oracle providing online retailers with suggestive search engines.
"SLI can look back on its first year as a publicly listed company with some satisfaction," said chief executive Shaun Ryan. "We enjoy a vast untapped market and product awareness that is in its infancy. Recent research out of the US indicated there are well more than 100,000 legitimate e-commerce sites in the world, and only a small portion of these have any kind of premium site search software or service in place."
The company raised $27 million in last year's IPO, of which $15 million was new capital to be invested in the business.
Shares of the company last traded at $1.40, and have declined some 36 percent over the past 12 months.