ASX-listed managed services provider Empired has revealed it has turned a profit and reduced its debt despite disruptions brought by the COVID-19 pandemic.
The company reported net profit after tax of $6.1 million for the 12 months ended 30 June 2020, compared to a loss of $15.3 million the previous year. It also reduced net debt to $4.4 million, down from $14.3 million on 30 June 2019.
The results came despite a 6 percent reduction in revenue and the disruptions on trading conditions and business operations from COVID-19, thanks to pay reductions for its board directors, cancelling its short term incentive plan, management of credit risk and a strong focus on cash flow and liquidity.
Empired also availed itself of government incentives such as JobKeeper to retain its staff during the period. Some 1000 of its staff were also mobilised to work remotely.
Empired managing director Russell Baskerville said, “Against a background of ongoing economic uncertainty and a very distressing period for all the communities in which we operate, we are pleased our financial performance provides confidence for our staff and clients and a positive outlook for our shareholders.”
“Our focus throughout the year on cash earnings has translated strongly, with record cash flow delivering an outstanding reduction in net debt and a clear expectation that the company will be in a net cash position in the coming months.”
The company also credited its performance to contract wins with Western Power, Rio Tinto and a few undisclosed customers worth a combined $66 million during the year.
Looking ahead, Empired is still cautious of the overall impact of the COVID-19 pandemic on the business, but is confident of earnings growth and strong financial performance. The company cites strong recurring revenue, a stronger sales pipeline and the $61 million Western Power contract win as drivers for growth in FY2021.