Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Xero says on target with accelerated cash burn

Xero says on target with accelerated cash burn as it takes on workers

Aug. 1 (BusinessDesk) - Xero, the cloud-based accounting software company, said a 47 percent increase in quarterly cash burn is on budget as it hires workers and takes on rival Intuit in the US market.

Xero's net operating and investing cash outflow rose to $17.3 million in the quarter ended June 30, from $11.8 million three months earlier, the company said in a statement. Staff costs rose to $19.1 million from $12 million and were up 88 percent from the June quarter last year. Cash holdings fell about 8 percent to $192.7 million.

The company doubled staff numbers to 758 in the 12 months ended March 31 and has continued to hire workers as it attempts to scale up to a profitable size. The company told shareholders at their annual meeting last month that it is considering a listing in the US after it reaches annual revenues of US$100 million, expected in this financial year, and has tapped former Microsoft chief financial officer Chris Liddell as chairman.

"From our perspective, there are no surprises," said Darryl Robinson, Xero's general manager group finance. "The quarterly cashflow results are in line with our targets and are reflective of our growth plans."

The shares fell 2.5 percent to $24.77 and have shed 21 percent this year. That's still above the $18.15 a share that US investors including Matrix Capital Management and the Peter Thiel-backed Valar Ventures paid in a capital-raising last October that gave Xero a $180 million cash infusion. At the rate it used cash in the June quarter, it has enough for at least another 2 1/2 years.

Sales were $23.5 million in the June quarter, up from $20.4 million three months earlier and up 81 percent from the same period last year

Chief executive Rod Drury told shareholders last month that America's incumbent accounting software provider Intuit is "spooked" by the arrival of Xero and was adjusting its strategy and products to protect market share from its upstart rival.

"Intuit's a formidable, large company in the US, but it's important to recognise that of something like 30 or 40 million small, medium businesses in the US, Intuit's customer base is five million," Drury told BusinessDesk after the meeting.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

I Sing The Highway Electric: Charge Net NZ To Connect New Zealand

BMW is turning Middle Earth electric after today announcing a substantial contribution to the charging network Charge Net NZ. This landmark partnership will enable Kiwis to drive their electric vehicles (EVs) right across New Zealand through the installation of a fast charging highway stretching from Kaitaia to Invercargill. More>>

ALSO:

Watch This Space: Mahia Rocket Lab Launch Site Officially Opened

Economic Development Minster Steven Joyce today opened New Zealand’s first orbital launch site, Rocket Lab Launch Complex 1, on the Mahia Peninsula on the North Island’s east coast. More>>

Earlier:

Marketing Rocks!
Ig Nobel Award Winners Assess The Personality Of Rocks

A Massey University marketing lecturer has received the 2016 Ig Nobel Prize for economics for a research project that asked university students to describe the “brand personalities” of three rocks. More>>

ALSO:

Nurofen Promotion: Reckitt Benckiser To Plead Guilty To Misleading Ads

Reckitt Benckiser (New Zealand) intends to plead guilty to charges of misleading consumers over the way it promoted a range of Nurofen products, the Commerce Commission says. More>>

ALSO:

Half A Billion Accounts, Including Xtra: Yahoo Confirms Huge Data Breach

The account information may have included names, email addresses, telephone numbers, dates of birth, hashed passwords (the vast majority with bcrypt) and, in some cases, encrypted or unencrypted security questions and answers. More>>

ALSO:

Rural Branches: Westpac To Close 19 Branches, ANZ Looks At 7

Westpac confirms it will close nineteen branches across the country; ANZ closes its Ngaruawahia branch and is consulting on plans to close six more branches; The bank workers union says many of its members are nervous about their futures and asking ... More>>

Interest Rates: RBNZ's Wheeler Keeps OCR At 2%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2 percent and said more easing will be needed to get inflation back within the target band. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news