Nathan Doughty yesterday interrupted a long silence on his Free Collaboration blog to post some details of the latest filings to the UK’s Companies House by [my former employer*] BIW Technologies. In BIW on the back foot?, he references this blog and makes a few statements that I would like to comment upon….
I was surprised to see last week that BIW Technologies released their accounts, albeit late, and that they appear to be in decline.
Only one year’s results are ‘late’, and the 2009 numbers are actually little more than three months old (will Nathan’s Asite follow BIW’s example and issue their 2008 and 2009 results in April, I wonder?).
Looking at the same reports myself (see BIW: Battered in Woking), I think Nathan’s use of the word ‘decline’ is possibly a bit strong. We are really, at this stage, talking about a one-year ‘blip’ in BIW’s fortunes – for me, a downturn sustained over two or more successive years (as Asite’s revenues declined over three years up to 2006, for example) might more accurately be termed a decline.
BIW, like many other businesses before it, has taken the opportunity to aggregate various losses (including some one-off ‘exceptional expenses’) into one year’s accounts (I believe accountants sometimes describe this as ‘kitchen-sinking’). The short-term impact can look bad, but any future bounce-back may look much healthier.
Staff numbers fell to 47 (down from 63 in 2008) and to keep costs low they have set up a development and support team in India.
Of course, I am one of the people who no longer work for BIW, so there is no argument that BIW has reduced its staff numbers. However, BIW’s establishment of a development and support team in India is hardly a new step – it was mentioned when BIW published its 2007 results. And the strategy is hardly novel – Asite outsourced its development to India some years before BIW did.
As I have written in several recent posts, 4Projects has certainly been producing some healthy results of late (see Good numbers from 4Projects and 4Projects and profitability), but the positive trend among other construction SaaS vendors is by no means universal. Depending on how you interpret the results:
- Australia-based vendor Aconex had something of a stand-still year up to but not including June 2009 (post);
- Business Collaborator‘s growth slowed in 2008, with a warning on further growth in 2009 (post);
- StoreData’s revenues dropped 10% in 2008 (post); and
- while Asite started 2008 with some positive numbers (my post which Nathan quotes), I did wonder if it would be sustained over the full year (see later post), let alone into 2009.
Since my post, I have received an email from BIW CEO Colin Smith who writes:
“Strange that Nathan has become a financial commentator! Also strange that he would crow about Asite’s (non) achievements – they’ve NEVER made a profit and have taken 10 years to grow to be 25% of our size…. [comment deleted**]”
Update (13 January 2010): BIW has issued its own news release on its results, stressing the restructured company’s debt-free status and strong balance sheet.
** Update (14 January 2010): After receiving an email from Asite CEO Tony Ryan threatening legal action over repetition of an alleged libel, I deleted a remark made by Colin Smith.
Update (15 January 2010): Another email received from Colin Smith:
In light of Asite’s unaudited results announcement (although very curious that they’ve not files 2008 accounts yet – especially in light of Nathan’s accounting zeal) I would like to revise my previous comments: they’ve actually taken 10 years to grow to 34% of our size. as opposed to the 25% stated. Sincere apologies to Asite for the error.
[* Disclosure: I worked for BIW Technologies Ltd from 2000 to May 2009, and have since undertaken occasional paid PR consultancy projects for the company.]