EBITDA (earnings before interest, tax, depreciation & amortisation) increased from $10.3 million to $11.1 million for the year, up 7.8%. Cash flow from operations after expenses grew from $7.8 million to $10.8 million in 2008, up 37%. However, after adjusting for one-off gains in 2006 and 2007 associated with the sale of its health business to Ascribe PLC, EBITDA from operations (normalised EBITDA) actually increased by 57% compared to 2007.
Two companies acquired by Jade in 2007, Methodware, which provides software to support Governance, Risk and Compliance requirements in over 600 organisations, and Empower, the trans-Tasman provider of Human Resources (HR) and Payroll systems, contributed 25% of the group’s revenue.
Chairman Ruth Richardson says a strategy focusing on multi-year contracts for software support and maintenance has seen this recurring revenue grow from under 40% of revenue five years ago to over 60%.
“Over the past five years, Jade has generated $28.9 million in cash from operations and raised a further $25 million of new capital. These funds have been reinvested in product development, acquisitions and the repayment of substantial levels of debt. Now, with $15.5 million of cash in hand and no debt due for repayment before July 2010, the company is well placed to advance its investment in software development and actively pursue a number of acquisitions of companies in similar sectors to supplement and accelerate organic growth,” Richardson says.
Key highlights for 2008 included securing a multi-year development contract with UK heath software and services company Ascribe PLC worth around $4 million a year, an agreement with Indian partner CMC Limited to sell Jade’s student management system throughout India, and winning a $2.5 million contract with the Electricity Commission.
Building on applications developed by Jade for UK train operator EWS, the company was also commissioned by Bombardier and GO Transit to develop the IT system that moves 170,000 commuters a day on seven lines in and out of Toronto, Canada.