Thursday 16 May 2019 3:14 pm

Accounting software firm Xero grows revenue thanks to strong UK performance

Accounting software company Xero has posted a sharp rise in revenue for the full year, boosted by strong subscriber growth in the UK.

Read more: Financial app store provider OpenFin backed in $17m funding round

The figures

Operating revenue soared 36 per cent to 552.8m New Zealand dollars (£267.9m) in the year to the end of March.

Subscriber numbers increased 31 per cent to 1.81m.

Net loss after tax widened by nine per cent to 27.1m New Zealand dollars.

Cash flow was 6.4m New Zealand dollars, compared to a negative cash flow of £28.5m last year.

Why it’s interesting

The New Zealand-based software company has posted strong revenue growth for the full year, boosted by a sharp rise in subscribers.

The growth was boosted by a record performance in the UK, where subscribers surged 48 per cent to 463,000 and revenue rose 50 per cent to £62m.

The firm appears to be growing its influence overseas, with international subscriber additions exceeding those from Australia and New Zealand for the first time.

Despite the revenue growth, Xero is yet to turn a profit, with losses widening further over the year to 27.1m New Zealand dollars.

The company said it will continue to focus on growing its small business platform and will look to reinvest cash in a bid to drive growth.

Read more: Adobe launches new software to boost customer experience

What Xero said

“We’ve delivered a strong result with a number of major milestones for Xero including our first positive free cash flow result, and the UK adding more than 100,000 subscribers within a six-month period,” said chief executive Steve Vamos.

“Another important milestone was the positive bottom line result delivered in the second half, which demonstrates our improving profitability.”