The Technology One Limited (ASX: TNE) share price is on the rise in morning trade following the release of its full year results.
At the time of writing the enterprise software-as-a-service (SaaS) company's shares are 6% to $8.72.
How did Technology One perform in FY 2019?
For the 12 months ended September 30, Technology One delivered revenue of 13% to $286 million.
As you can see below, a key driver of its strong growth was its SaaS business. It achieved revenue growth of 40% to $81.5 million during the 12 months. It also ended the period with SaaS Annual Recurring Revenue (ARR) of $102 million, up 44% on the prior corresponding period.
The company's good costs control led to expenses growing just 3% over the prior corresponding period. This ultimately led to net profit before tax increasing 50% to $76.4 million. This was at the top end of its guidance range.
And although its cashflow generation fell 14% to $45 million, the Technology One board lifted its full year dividend by 8% to 11.93 cents per share.
Technology One's CEO, Edward Chung, was pleased with the company's performance in FY 2019.
He said: "I am pleased to announce our tenth consecutive year of record profit and record Annual Recurring Revenue (ARR) for TechnologyOne. Our global SaaS ERP solution is transforming our customers' business and makes life simple for them. This is resonating strongly with the market, driving our continuing strong results."
Mr Chung explained that the SaaS business' growth is all organic and expects it to continue.
"The TechnologyOne global SaaS ERP solution is growing very fast with SaaS ARR of $102m, up 44%. This growth is all organic and includes no acquisitions. We added 88 enterprise customers this year to our global SaaS solution. We now have 435 large scale enterprise customers, with hundreds of thousands of users, making it the largest single instance SaaS ERP offering in Australia. Our Total Annual Recurring Revenue has now hit $202m and is set to exceed $500m in FY24."
Outlook.
The CEO advised that Technology One's sales pipeline remains strong and expects the SaaS business to continue growing strongly. As a result, the company is expected to deliver strong profit growth once again in FY 2020.
Further guidance will be given at its annual general meeting and with its first half results next year.
