KEY POINTS:
Web-based accounting software company Xero boss Rod Drury is upbeat about prospects as customer numbers exceed expectations, even though receipts are below forecast.
The company raised $15 million in an initial public offering last year and today reported a net loss for the year to the end of March of $4.3 million.
The company said today that in the year since its offer document was issued last May it had achieved 1406 customers, compared to a target of 1300 in the offer document.
Receipts from customers for the year to May 10 were $213,000.
That compares with an updated forecast of $250,000 to $350,000 issued at the start of February, and is even further below the $550,000 forecast last May.
Mr Drury said that going into the small business market was probably a little harder than had been expected, as the company built relationships to get the "word of mouth effect".
Also response from the accounting community was better than expected, so more time was spent on them than on end customers.
Sales had accelerated coming into the first natural software changeover period in March and April, he said.
As at May 10, Xero's cash balance was nearly $9m, $613,000 more than forecast.
For the year to the end of March operating expenditures were $5.1m.
In the offer document Xero said an overall profit was not expected for at least three years, and today Mr Drury said it was hard to give an indication of when profitability might be reached.
"The thing we can manage is costs, and I think with the tightening of the market we're not seeing people getting funded behind us, so we feel a bit more relaxed that we're not going to have a kind of better funded one of us coming behind us," he said.
The company now had staff in Britain, and sometime in the next year would enter Australia.
Shares in Xero were issued at $1 each, and debuted on the stock exchange last June, reaching a high of $1.17 the next day. During afternoon trading today they were up 4c from yesterday's close at 82c, having been as low as 68c in February.
- NZPA
