Serko shares soar 659% in 2017, topping NZ stock market

By Rebecca Howard

Dec. 29 (BusinessDesk) - Serko is on track to be 2017's best performer on the stock exchange after gaining 659 percent so far this year as investors are increasingly confident it will move into the black.

The online travel booking software developer, which has roots that date back to 1994, listed in 2014 and its shares first traded at $1.13. However, Australia's economic slowdown and project delays weighed on revenue and it touched a low of 25 cents in April before storming higher in October when it posted its first mid-year profit and reiterated expectations for a maiden annual profit as transaction volumes increased. It currently has a market capitalisation of $165 million and recently traded at $2.17.

The Auckland-based company pushed even higher in November when it affirmed guidance for total operating revenue to be between $18 million and $19 million in the year ending March 31, 2018, and said operating expenditure will increase with its plans to expand the business in the Northern Hemisphere.

In the year to March 2017 it reported a loss of $3.3 million, narrowing from a loss of $6.3 million a year earlier.

"They have had a fantastic six months ... it is a reasonably sized company now. It's getting nearer the mid-cap range," said Grant Williamson, director at Hamilton Hindin Greene in Christchurch. The company's increasing market value could see it on the radar for investors in 2018.

"The best way to get noticed on the market is to get to a certain size so market analysts have to produce research notes and until that happens, you won't get too many investors interested," he said. He underscored, however, the "company will now have to prove itself with positive earnings."

Highlights for the year include a partnership deal with Gullivers Travel Associations and the development and release of Zeno, an artificial intelligence booking platform aimed at growing its customer base and giving customers the opportunity to add additional content to their travel programmes via the Zeno hub.

In November, it announced a non-binding memorandum of understanding with travel management company ATPI Group, where ATPI will be licensed to deploy Serko’s Zeno technology globally, including in the USA, Europe, UK and Asia.

(BusinessDesk)

© Scoop Media