Innovation SLI Systems widened its annual loss while sales met the reduced guidance it gave in April, after the online retail search engine developer reorganised its sales team and was impacted by a weaker Brazilian economy
The Christchurch-based company reported a loss of $7.1 million in the year ended June 30, from a loss of $5.7 million a year earlier, it said in a statement. Operating revenue increased 27 percent to $28.1 million, in line with the $28 million guidance given in April, when it flagged its second half would be lower than expected.
Annualised recurring revenue, its preferred financial measure based on forward subscription revenue, rose 39 percent to $34.6 million with “growth impacted by the disruption caused by the change of sales leadership and weaker performance in the Brazilian business,” the company said.
SLI is forgoing profits and dividends to fund growth in the expanding e-commerce market, particularly in the US, and says its software as a service is the second biggest after Oracle to provide online retailers with suggestive search engines. SLI said it is on track to be cash flow breakeven in the near term. Annual cash outflow was $5.8 million, with $1.8 million of that spent in the second half, slowing from the first half’s $4 million outflow.
At balance date the company had $5.6 million of funds on hand. SLI said it had focused on productivity and reduced staff numbers by six to 175 to reach breakeven without requiring additional investment.
“With our improved sales and marketing capability and our market-leading products, we will focus on continuing to grow revenues in our core markets of the US, the UK, Australia, and New Zealand,” said chairman Greg Cross. “We have seen a renewed focus on e-commerce applications from Silicon Valley and our market leading product positions us well in this environment.”
SLI shares last traded at 70 cents and have fallen 42 percent since the start of the year.