After the market's close yesterday evening, junior technology company Integrated Research Limited (ASX: IRI) announced a promising set of half-year results.
In the six months to 31 December 2014, the global provider of proactive performance management software announced a 67% rise in net profit to $7.548 million, on the back of a hefty 28% increase in revenue to $33.5 million, versus the prior corresponding period.
The result was in line with the updated guidance it released to the market on January 7.
All product lines witnessed solid double-digit revenue growth, including:
- Unified Communications and Contact Centre revenues increased by 41% to $17 million
- Payments revenues increased by 15% to $2.5 million, and;
- Infrastructure, including HP-Nonstop, increased revenue by 21% to $11.5 million
With 95% of revenues being derived from outside Australia, Integrated Research's results were buoyed by a depreciation in the Australian dollar, which averaged 88 cents for the half. Nonetheless on a constant currency basis, profit still would have been 48% higher than the prior period.
Chairman Steve Killelea said, "The strong first half result has been achieved by a realignment of the strategic focus of the Company to become a truly customer centric organisation."
He continued: "The recent release of Prognosis 10 was an evolutionary step for the Company into cloud-based subscription services as well as delivering a platform for rapid product creation. The result bodes well for the future as the new licences came from a wide range of customers and products, underscoring the strength of the Company's position in its markets."
Integrated Research's board resolved to declare an interim dividend of 3.5 cents per share, franked to 35%, and up from 2.5 cents per share in the prior period. As a result, at yesterday's closing price of $1.41, it places the company's shares on a trailing dividend yield of 4.9%, grossed-up.
Darc Rasmussen, CEO of Integrated Research said: "The Company's investment during the past year in four strategic initiatives around marketing, partnering, solutions and regional growth is now beginning to show results."
Should you buy shares of Integrated Research?
If Integrated Research continues its strong performance into the second half of the current financial year, its shares are trading on a forecast price earnings ratio of just 16. Although shares could jump higher this morning, if you're looking to add a small technology stock to your portfolio, it could be worthy of further investigation.
