Diligent to launch new product, profit climbs

Diligent Board Member Services [NZX: DIL] increased its revenue by 28% in 2014 to post an after-tax profit of $US8.9 million for the year to December 31.

The software company reported total revenue of $US83.1 million during the year with adjusted earnings before interest, tax, amortisation and depreciation of $US24.6 million, an increase of 30% on the previous corresponding period, according to its financial statements. 

The company also announced plans to introduce a new software-as-a-service product during the third quarter of 2015.

“The launch of DiligentTeams will be an important milestone in the evolution of the company, as we look to extend our best-of-breed technology beyond the boardroom and deliver even greater value to our customers, “chief executive Alex Sodi says.

Diligent now has $US70.8 million in cash and cash equivalents and short-term investments and no bank debt, compared with $56.1 million in cash and cash equivalents and short-term investments as of December 31, 2013.

Excluding exceptional items from the income statement, such as special committee and revenue restatement related costs, Diligent’s adjusted net profit was $US12.9 million, or 11c a share.

The company incurred $US3.7 million of costs in relation to its investigation into a series of administrative errors that saw the overpayment of options to management and the incorrect recognition of revenue, prompting a restatement of the company's accounts. That was on top of $US7.8 million of costs relating to this issue incurred in the 2013 year.

“We ended 2014 on a high note generating fourth quarter revenue that exceeded the high-end of our guidance range and full year revenue growth of 28% year-over-year,” Mr Sodi says.

“Our results demonstrate strong demand for Diligent Boardbooks and the continued execution of our growth strategy.

“Looking to 2015, we will continue to make investments to strengthen our leading solution, as we also work to introduce new and complimentary use cases and expand our global sales and marketing platforms to position Diligent for its next stage of growth."

Diligent shares last traded at $6.12, having gained 27% over the past 52 week period.