MYOB Reports Impressive Growth

Australia’s largest provider of business management solutions, MYOB has a lot to shout about.  Earlier today MYOB released its half-yearly financial report, which reports double digit revenue growth for the first half of this year, ending June 30th. The 30-year-old vendor of accounting software currently offer more than 50 products and services, and are predicting continued sales growth for its cloud and mobile solutions.

In a statement from this morning, MYOB revealed revenue of A$140 million for first half of this year. This is 21% more than the corresponding period of last year, this is before interest, taxes, depreciation, and amortization (EBITDA). Additionally it reports a 29 per cent increase in its interim operating profit to $70m and an interim net loss that fell to $5.6m from $6.3m.

MYOB currently only sells its software in Australia and New Zealand and catering specifically to the needs of SMB’s, are looking for a stronghold in a reportedly billion dollar market.  Over the past three years MYOB has spent over $100 million on R&D, $40 million in the last year alone specifically to expand its cloud offerings for SMEs.

Tim Reed, the CEO at MYOB explained the motivations behind this, he was reported as saying,  “With a $40 million investment in R&D this financial year, we have continued to expand our cloud offerings to meet the evolving needs of small and medium businesses. In the first half, we introduced innovative mobile solutions such as MYOB PayDirect – a category-first for credit card payments on smart phone – while the MYOB OnTheGo app is enabling greater mobility for businesses.” He continued, “MYOB also continued to invest in talented people, with the business adding 100 new jobs over the past six months to meet rising client demand for an expanding product suite.”

MYOB now have over 86,000 clients using cloud files, which increased from 43,000 a year ago. Additionally, 63 per cent of all new product registrations in July were for cloud solutions, which is up from 36 per cent last year.

Reed believes this is what it will take to make MYOB stand out from the competition. He said, “In addition to the rapid growth of our cloud solutions, we’ve continued to build on our leading position in SME accounting software. Usage of MYOB accounting software is more than four times our nearest competitor.” He continued, “The recently announced acquisition of PayGlobal has doubled our presence in the mid-to-large sized business market in Australia and New Zealand.  It is a complementary offering to MYOB EXO, and in early 2015, we expect to introduce a new cloud-based business management system for larger enterprises.  We are excited by its development as it will help growing businesses to become more flexible and mobile.”

However MYOB is facing fierce competition from other cloud-based accounting software providers operating in Australia, mainly from Xero and Intuit. It will be interesting to watch how things develop.