Accounting Firms

Xero FY21 revenues rise 18% to $607m

The group’s UK revenues climbed 22% year-on-year to NZ $224m, while its US operations experienced a slower growth rate of 2% to NZ $57m in FY21

Global cloud-based accounting software platform Xero saw its FY21 operating revenue increase 18% year-on-year to NZ $848.8m ($607.2m).

The group’s annualised monthly recurring revenue (AMRR) also increased 17%to NZ $963.6m ($689.3m) for the 12 months to 31 March 2021.

Xero’s EBITDA for the period spiked to NZ $191.2m ($136.8m), a 39% year-on-year rise, as its net FY21 profit grew NZ $16.4m ($11.7m) to NZ $19.8m ($14.2m).

Despite its total operating revenue increasing by almost NZ $30m ($21.5m) from H1 to H2 of FY21, the firm made a NZ $14.7m ($10.5m) net loss in the second half of the financial year.

This loss can be attributed to higher sales and marketing, product design and development, and general administrative costs.

Regionally, Xero’s UK revenues climbed 22% year-on-year to NZ $224m ($160m), while its US operations experienced a slower growth rate of 2% to NZ $57m ($40.8m) in FY21.

The group said: “FY21 was a year of two distinctly different halves, with the impact of Covid-19 most felt during the first few months of the year and we reduced our sales and marketing spend in response. 

“As conditions improved, we picked up our spending and this helped drive higher subscriber additions in the second half of the year.”

Looking ahead, the group said that it expects initial payments of NZ $150m ($107m) due to the acquisitions of Planday and Tickstar to impact FY22’s balance sheet.

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