Accounting software vendor, Reckon, has had a bit of a tough first six months with revenue and EBIDTA down within its Business Group as it transitions towards a subscription-based model.
Reckon noted that moving to a subscription-based model impacts revenue in two ways with subscription products being cheaper than the products being replaced and the monthly payment option delaying revenue recognition.
Despite this, Cloud revenue has grown 44 per cent and represents 30 per cent of core product revenue.
The vendor's overall revenue grew six per cent to $54 million in the six months to June 30. EBITDA also increased five per cent to $20.2 million, but net profit took a slight one per cent knock down to $9.3 million in comparison to the same time last year.
Reckon Group CEO, Clive Rabie, said it will be continuing to invest in people, marketing and development in the short term to allow longer term revenue and growth.
Within its Accountant Group, the vendor said its document management, workpaper management and SyncDirect modules attracted the most customer interest. Subscription revenue grew eight per cent due to new customers and cross selling additional modules to existing customers.
"The market potential for each of these products is significant," Reckon said.
Its International Group's revenue had grown 19 per cent and EBITDA was up 44 per cent. International revenue represents 19 per cent of Reckon's overall revenue and it has firm sights set on the UK and USA market growth.
It has launched its Virtual Cabinet product into USA and has a backlog of product orders in place, which will be delivered in the second half of its financial year.