TIN200 MD Greg Shanahan: "And in three of the past four years, total TIN200 revenue has increased by $1b a year. That's like adding a Fisher & Paykel every year." Photo / Brett Phibb
TIN200 MD Greg Shanahan: "And in three of the past four years, total TIN200 revenue has increased by $1b a year. That's like adding a Fisher & Paykel every year." Photo / Brett Phibb
The technology sector boomed in FY2019, cementing its position as one of our largest export earners according to the annual TIN (Technology Investment Network) Report.
The NZ Trade & Enterprise-backed survey of our largest tech companies by revenue (the "TIN200") found total tech sector revenue rose by more than $1 billion for the second year in a row as it jumped from $11.0b to $12.1b.
Within that total, export revenue generated by NZ-based technology companies jumped by 11 per cent to $8.7b - reinforcing that the sector has become one of our biggest offshore earners.
In FY2019, dairy brought in $14.1b in export receipts, tourism $11.3b, meat $7.7b and forestry $5.5b.
TIN managing director Greg Shanahan says technology is on track to become our top export earner - and in short order.
"The gap between TIN200 companies and tourism has closed by about $1b [in 2019] and we think that technology will become NZ's largest export sector in three to five years time," Shanahan told the Herald. (The TIN200 is his company's list of our largest tech companies by revenue.)
The TIN boss concedes his prediction could be skewed by currency movements, or unexpected developments in dairy, but he says tech is on a clear trajectory to be number one.
"The TIN200 now has three companies with annual revenue over $1b," he says (homegrown IT services giant Datacom with $1.3b, Chinese-owned Fisher & Paykel Appliances with $1.2b and locally-listed Fisher & Paykel Healthcare on $1.1b).
"And in three of the past four years, total TIN200 revenue has increased by $1b a year," he says.
"That's like adding a Fisher & Paykel every year."
The TIN report always draws a degree of debate about the size of the sector, given (unlike diary, tourism, meat and forestry), Statistics NZ has no "technology" category to match Shanahan's broad-strokes definition that takes in hardware, software, services, manufacturing, ag-tech and biotech - though it doesn't have scope for telcos like Spark, Vocus, 2degrees and Chorus whose businesses are now immersed in data and IT services (the TIN boss says he wants to keep the focus on companies with significant exports, and telcos are mainly domestic-focused).
The TIN200's top 10. Weta Digital revenue is estimated. "T10" companies are those on EY's "Ones to Watch" list, which forms part of the wider report. Source / TIN Report 2019
But by any definition, tech is big and getting bigger.
TIN200 companies are booking consistent profits (overall earnings growth was 15 per cent in FY2019) is and the number of people employed by the technology sector increased by 7.9 per cent last year to 51,569.
"The industry is really hitting scale," Shanahan says.
He Shanahan reiterates his catchcry that tech is not a gimmick and that we're not in the midst of another dotcom-style 1990s bubble. The tech sector is now a mainstay of the New Zealand economy, and needs to be treated as such by policy makers and the country as a whole, he says.
While the top of TIN's top 200 was stable in composition, a number of companies made big leaps up its charts.
