Diligent sales almost triple in June quarter

Diligent shares closed yesterday at $3.92, just below their record $3.97, and were being bid higher. Photo / NZH

Software company Diligent Board Member Services' sales momentum continued in the June quarter in which it says it made an operating profit for a fourth successive quarter.

Second-quarter sales nearly tripled to US$10.1 million (NZD$12.6m) in the three months ended June compared with US$3.7 million in the same quarter last year, the company said in a statement. That took first-half sales to US$18.3 million, up from US$6.6 million last year.

The software-as-a-service (Saas) company said it added 216 new clients in the latest quarter, up from 133 in the same three months last year

"Sales momentum in Australia in particular was gratifying as Diligent added 12 ASX companies to its client list," it said.

The company now counts 224 Fortune 1,000 companies as clients, with 35 of them added in the June quarter, as well as 30 per cent of companies within Britain's FTSE 100 index, it said.

Client retention on a trailing 12 month basis was 97 per cent while client upgrades of US$1.4 million in the June quarter were up more than five fold on the June quarter last year.

Diligent said its continuing profitability on an operating basis "highlights the financial leverage" of its Saas business model and further evidence of its operational and financial strength was shown in the US$5 million increase in cash flow in the latest quarter which took cash at June 30 to US$17.2 million.

Annualised recurring sales at June 30 reached US$39.2 million, up from US$14.9 million a year earlier, "dramatic top line growth by any standard," the company said.

"Most importantly, Diligent's senior management continues to deliver on both profitability and revenue growth," it said.

"Diligent's management expects the positive trends in cash flow and improved balance sheet strength and flexibility to continue throughout 2012."

Diligent shares closed yesterday at $3.92, just below their record $3.97, and were being bid higher.

That's a long way from the year low at $1.02 and as low as 7 cents in March 2009 when the company's future looked doubtful.