WANdisco feels ‘wonderful effect’ of exchange listing

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SOFTWARE company WANdisco, which floated on the stock exchange last month, reported a 60 per cent increase in subscriptions in the first half of 2012.

The Sheffield-based company said trading for the first six months of the year has been strong and it has signed up a number of new clients including office equipment company Ricoh and postage machine group Pitney Bowes.

WANdisco’s chief executive David Richards said the group’s float – the first Yorkshire company to list on the London Stock Exchange in two years – has had “a wonderful effect”.

“It’s been very positive. The main effect is when hiring people. We’ve been able to hire people without recruiters – people are coming to us,” he said.

Ahead of the opening of an office in Belfast, Mr Richards said the group has attracted “real top talent”.

He said that the IPO has also given customers confidence in the business.

“Customers are committing to longer term deals at a higher price,” he said.

During the first half WANdisco won its first customer in China, signing up telecoms equipment company Huawei.

“There’s a lot of scope for growth in China,” said Mr Richards.

“China is a huge market and we’re opening an office in Chengdu, which is a twin city of Sheffield. Chengdu is our Chinese equivalent with a vast industrial sector.”

In the second quarter of 2012, WANdisco’s subscription bookings reached a record level of £1.2m, representing a 43 per cent increase year-on-year.

When combined with bookings of £1m achieved in the first quarter, the company achieved total bookings for the first half of £2.2m, a 60 per cent increase year-on-year.

A number of existing clients renewed their subscriptions including Disney, Juniper Networks, Cisco Systems, Vanguard, McGraw Hill, Telenav, McAfee and ING.

Renewal rates by value rose 230 per cent, based on subscription licence values booked during the period.

WANdisco said many of these customers bought additional user licences, added on more sites or committed for longer time periods.

After adjusting for multi-year deals, the annualised renewal rate by booking value rose by 113 per cent.

During the first half the company launched a new online training subscription product.

“We were getting a lot of requests from customers who wanted to learn how to use our products so we recorded the training material on to a video and we are beginning to sell them,” said Mr Rich- ards.

“We’ve earned $100,000 from this new product. That wasn’t in our forecasts.”

The company generated further cash during the period.

The group said that once it adds the cash generated during the first half with the £15m raised from the float, the business is in a strong position to accelerate growth by increasing the sales team and investing in new products.

“This year we’re hoping to go from a sales team of five to between 20 and 25.

“We’re well on our way to getting there,” added Mr Richards.

Historically WANdisco’s second half is its strongest, due to higher levels of renewals.

The group said it is confident the company is on track to achieve its targets for the current financial year.

Much of WANdisco’s appeal is that nearly 80 per cent of its sales come from the US, which is far more insulated against the recession than the UK and Continental Europe.

The company currently has around 200 customers, which it believes is a small proportion of the total number of companies using its kind of software.

Its blue chip clients include Wal-Mart/Asda, Aviva, AT&T, Barclays, Hewlett Packard, Honda, Intel, Johnson & Johnson, Motorola and Nokia.