Asite 2006 financials

Much earlier than in previous years, the latest annual results from UK-based collaboration vendor Asite have just been released (view Stock Exchange announcement).

• The gradual downward slide in Asite’s turnover shows no sign of abating (see previous posts on interims and 2005 results; this is not a ‘dip’ in sales, as Hemscott reports). Turnover for 2006 was down 11% to £1.354m from a 2005 figure of £1.529m. Indeed, turnover in the second half of the year was lower than the first.
• Asite reported a pre-tax loss of £0.857m (2005: £1.409m), so a bit of an improvement there, mainly due to cuts in sales and distribution costs and administration expenses in the first half of the year.

The turnover figure places Asite some distance behind other UK construction collaboration vendors such as BIW Technologies (my employer; last FY: £4.66m), 4Projects (I recently guess-timated a last FY turnover of £3.4m), BuildOnline UK (now part of CTSpace (£2.793m – see post), and Business Collaborator (£2.35m). It even puts Asite behind relative newcomer, StoreData, which, while mainly focusing on the retail fit-out sector, still turned over £1.594m last year (see post).

Reading the chairman’s statement, I see that, at the end of 2006, Asite said it had a total user community of 24,716 users from 3,457 organisations. This is roughly a third of the totals claimed by both BIW and 4Projects. During 2006, Asite registered 5,988 new users and 676 new user companies (a BIW news release says it registered 12,426 new users, and 1149 user organisations in the same period).

More interestingly, the statement talks about the impact of its new products: Asite Workspace and Asite cBIM, both launched earlier this year. It says these new products “have significantly improved the Groups position in its markets”. This is a speculative statement, surely, about the overall product portfolio as it is way too soon for Asite to draw any firm conclusions about the financial impact of these products – particularly, the BIM product, which has been launched into an AEC industry which has yet to embrace BIM widely (see last week’s BuildingSMART post).

The Workspace product was launched on a per-user licensing model, and it seems Asite is “considering the introduction of a per user price model” for its other products too. As I have previously pointed out in relation to Workspace, this would be a brave move seeing as most competing products are priced at a flat rate per project, programme or enterprise. The argument has been that charging on a per user basis in a low-margin industry like construction may lead to project team companies discouraging participation, or – perhaps worse – getting multiple employees to share a single user login (thus diluting the effectiveness of audit trails) in order to keep costs down.

On a more positive outlook section, the chairman’s statement talks about Asite’s major clients (some of them Asite shareholders) and major contracts awarded in 2006. It also mentions a “a significant win” at the start of 2007 in Abu Dhabi: the Al Raha Beach Resort (“This project, a new city district on 6.8m square metres of reclaimed land, will run for 12 years at a construction spend of US$14.700bn.” – this was the project (to be constructed by a joint venture including Asite shareholder Laing O’Rourke) I knew about back in January when a couple of Asite directors bought shares in the company). Doubtless, this project is one factor in the increase in the group’s contracted pipeline at the start of 2007 of £5.811m (2006: £3.100m), though a single 12-year project is, of course, unlikely to make a significant impact on Asite’s 2007 turnover.