Shares in accounting software start-up Xero have surged back towards all-time highs after it boasted it now has more clients in Australia than in its home turf, New Zealand, as it ramps up its global push

October 3, 2013 Leave a comment

Sales soar as Xero ramps up global push

October 3, 2013 – 10:49AM

Brian Robins

Shares in accounting software start-up Xero have surged back towards all-time highs after it boasted it now has more clients in Australia than in its home turf, New Zealand, as it ramps up its global push. In the September half, revenues surged to $NZ30 million ($27 million) from $NZ16.9 million a year earlier, whikle at the end of the half, revenue was running at an annualised $NZ70 million.Perhaps more importantly, the cashburn has slowed, dropping to just $NZ3.8 million in the September quarter. Its end-quarter cash reserves stood at $NZ65 million down from $NZ68.8 million three months earlier. In the June quarter the cashburn was $NZ9 million.

In early trading, the shares were ahead 40 cents at $16.90 in light volumes.

The figures released today exclude its Xero Personal product, which is being withdrawn in November next year. It contributed $NZ600,000 of sales last year.

Total paying customers rose to 211,300, up 89 per cent from September last year.

The company is seeking to build its customer base to one million, burning cash in the process as it builds scale. Cash on hand fell to $NZ55 million from $NZ69 million at June 30.

The fastest growth in the first half came from Australia, where customers rose 143 per cent from a year earlier to 79,100.

US and Rest of the World customers rose 141 per cent to 16,600 and UK customers rose 99 per cent to 30,100.

In its largest market of New Zealand, customers rose 49 per cent to 85,500.

Xero didn’t give figures for earnings.

Filed under TMT Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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