Losses reduce by two thirds at Wandisco
Turnaround plans are well underway at Sheffield software business Wandisco, as losses reduce by an impressive £17m.
The embattled company, which saw major management reshuffling last year, returned $10m (£8.19m) in pre- tax losses for the year to December 2016, reduced from $31m (£25.4m) the year before.
Company revenue for the year rose to $11.4m from $11.0m in 2015.
Wandisco, which specialises in distributed computing and also has a California base, said it had been a year of “financial transformation and operational progress”.
It is already seeing the fruits of its labour as its share price surged by 22% in January following the announcement that bookings were up 72% – and now it reports that Q4 bookings were up more than 90%.
Wandisco said its Big Data and cloud division, Fusion, was “ideally positioned” to take advantage of the rapid growth in its sectors, and chief executive David Richards said the company had “realigned” its cost base, and was hopeful that it will deliver cash flow breakeven and EBITDA positivity.
The results will be welcome to the business after a year of turbulence in and out of the boardroom.
Its results showed that staff numbers dropped during the year from 118 to 143, which “resulted from efficiencies in finance and administration”, Wandisco said.
Founder and chief executive David Richards was ousted in October 2016, before making a surprise return a month later – one that coincided with the departure of chairman Paul Walker and non-executive director Ian Duncan.
The company has been tight-lipped about the reasons behind the feud, but a disappointing performance last year may have compounded it.
Wandisco said today that it was still “exploring the opportunity” to work with another chairman, having still not found a replacement.
CEO Richards commented: “Over the past year, as the Big Data and Cloud markets have continued to expand, we have seen global enterprises increasingly require the ability to move large volumes of data at speed across both on-premises and cloud environments. WANdisco Fusion is the only solution available in the world that enables the replication of continuously changing data, whilst guaranteeing this data is continuously available, consistent and delivered with zero business disruption.
“As a result of this significant expansion in our core Cloud markets, our total bookings increased by 72% during 2016 and 97% in Q4 2016. Our OEM with IBM, as well as our other channel relationships, have been central in driving new business, by enabling us to take advantage of this market opportunity whilst reducing our operational cost base throughout the year. This has resulted in a $11.2m reduction in overheads and a halving of the EBITDA loss from 2015 to 2016 bringing us much closer to cash flow breakeven.
“We continue to build on this momentum with a strong new business pipeline which, combined with a significantly reduced cost base together will further underpin our progress towards profitability.”
