WiseTech sees bright full year but market shrugs


Aggressive Australian software giant sees interim profits and revenues lift

WiseTech sees bright full year but market shrugs
Richard Whites see high growth and increasingly specialised needs in e-commerce cross-border delivery

 

Australian logistics software success story WiseTech Global has reported an 8 per cent rise in net profits for the first half of the financial year compared with the previous year’s first half.

WiseTech ended the six months with $15.6 million as against $14.4 million previously, with CEO Richard White hailing its customer retention rate and rise in earnings before interest, tax, depreciation and amortisation (EBITDA).

"Our global operations continued to deliver quality growth with revenues up 31% to $93.4m and EBITDA up 32% to $31.8m for the first half 2018, while we rapidly and relentlessly delivered significant new product innovations and extensive geographic expansion to accelerate our future growth," White says in a results document.

"The power and strength of our CargoWise One operations are reflected in their 100% recurring revenue, annual customer attrition rate of <1% and 46% EBITDA margin — all delivered while enlarging our geographic footprint and significantly expanding our pipeline of innovation to further build our leadership position."

The company notes 24 of the top 25 global freight forwarders are customers as are 33 of the top 50 global third party logistics providers, basing figures from consultancy and market research firm Armstrong & Associates.

It says items in its product pipeline include:

  • development of its global rates ecosystem, incorporating real-time ocean and air rate processing and management with automations for bookings, invoicing and execution
  • international e-commerce integrated solution for high volume, low value (HVLV) e-tail shipments from origin to door, currently in prototype test with development partner
  • Universal Customs Engine designed to deliver complex, multi-year localisations in a fraction of the time and cost
  • advancements in architecture engine, GLOW, which allows rapid product development across multiple operating systems on any device, by non-technical staff
  • comprehensive global air cargo tracking, including air waybill tracking, events and automations.

WiseTech continues to expand internationally by acquisition.

Since last June, it has made 11, including names familiar locally such as CMS Transport Systems, Microlistics and Digerati.

"In a rapidly evolving global environment, our significant advances in product development, expanded global footprint, powerful global CargoWise One platform and financial strength, we are exceptionally well-placed to meet the needs of our customers, leverage macroeconomic conditions and drive the competitive dynamics of logistics execution around the world," White says.

"Additionally, e-commerce is becoming a transformative model alongside the traditional bulk freight markets we already service, with the exponential volumes involved simultaneously pressuring and expanding third-party logistics businesses.

"We see high growth and increasingly specialised needs in e-commerce cross-border delivery modes and we have product capabilities expressly targeted at this mega trend.

"As e-commerce logistics evolves, we too continue to develop the technology and productivities needed to support the high volume, small parcel industry."

Despite the company’s accentuation of the positive and a full year revenue and gross earnings projections mostly in the 30-40 per cent rise range.

However, the market marked the company down, with share falling 22 per cent to $11.40, reportedly due to a missing profit forecast.

 

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