Xero posts half-year earnings, announces delisting from NZX

Xero has reported its half-year earnings to 30 September 2017 posting positive EBITDA of $5.4 million and growing ACMR to $416.9 million.

With 1,199,000 subscribers as at 30 September 2017, Xero added more than 160,000 net new subscribers in the half-year.

Operating revenue grew 37% over the same period last year to $187.8 million, and more than $1 billion was added in total lifetime value in the past 12 months.

Cash flows from operating activities were positive at $6.1 million for the half-year.

Rod Drury, Xero founder and CEO, says, "Xero delivered another strong half-year result, achieving positive EBITDA for the first time, and is emerging as one of the largest and fastest growing listed technology companies in Australasia.

"We continue to cement our position as the cloud accounting leader in Australia, New Zealand and the UK, with more than half a million subscribers in Australia, and a quarter of a million subscribers in each of the New Zealand and UK markets.

Working with accountants and bookkeepers, Xero is positioned to benefit from the growing economy of millions of small businesses worldwide.

During the period, the company delivered a wave of significant new products, demonstrating that Xero is evolving from a back office product to providing front office solutions, and from online accounting software to a small business platform.

There is growing recognition internationally of Xero's global platform.

"We are well on our way to rewiring how businesses work together, leveraging our investment in Amazon Web Services with artificial intelligence and machine learning to deliver a significant wave of new products.

"These products combined with connections to more than 140 financial and fintech organisations, large enterprises and government agencies, deliver productivity and opportunities to help accountants, bookkeepers and small businesses grow and create new jobs," Drury says.

To support the company's next phase of growth, Xero announced that it is in the process of consolidating the company's listing on the Australian Securities Exchange (ASX).

As part of this process, it is intended that trading will cease on the New Zealand Stock Exchange (NZX) at the close of business on Wednesday, 31 January 2018, and that Xero will delist from the NZX with effect from the close of business on Friday, 2 February 2018.

The decision was made following an extensive strategic process which thoroughly canvassed all available options.

"Xero is an ambitious New Zealand company. We will remain headquartered in Wellington and domiciled in New Zealand," says Drury.

"We thank the NZX for providing a valuable platform to support Xero's first decade as a public company. Our success wouldn't be possible without the support of the NZX and our shareholders.

"While more than half of Xero's people live and work in New Zealand, 80% of our revenue now comes from outside New Zealand. Our strategy is to drive further growth in markets like UK, North America and Southeast Asia.

As Xero continues to grow, gaining enhanced access to deeper capital markets, increased liquidity and a broader base of potential investors is critical to fulfilling our ambition to be the leading global small business platform serving millions of customers.

Shares on the NZX will be automatically transferred to the ASX.

Shareholders will not need to take any action to facilitate this process.

Holders of Xero shares on the ASX will not be affected by this process.