4Projects reports record revenues

4Projects turnover in 2013 reached £6.351m. The SaaS vendor reported its seventh straight £1m-plus profit, and sees BIM as a key to sustained future growth.

Newcastle, UK-based SaaS construction collaboration technology develop 4Projects, since February 2013 a subsidiary of US ERP vendor Viewpoint, has reported record turnover for the year ending 31 December 2013. It achieved revenues of £6.351m, generating a profit of £1.6m.

Direct comparisons with the previous year are slightly difficult as the business changed its financial year-end from 31 March to 31 December, so the latest accounts only show a comparison with the nine months from April to December 2012. However, I calculate the 2012 full-year equivalent numbers were turnover of c. £5.651m, and pre-tax profit of £1.489m (though this latter figure would have been higher but for exceptional items of £616k – “made up of employee incentive payments and professional fees relating to the acquisition by Viewpoint Inc. on 1 February 2013 and other non-recurring costs.”). On the full-year equivalent figures, the 2013 results represent a 12% growth in turnover (as indicated in September 2013‘s double-digit trading update), and profit up 7%.

International operations

Most of 4Projects’ reported revenues – 80% – still derive from UK operations, but the overseas portion is clearly growing, up from 9% the previous year. In a conference call with MD Alun Baker, finance director Chris Baty and VP BD EMEA director Steve Spark, I learned that much of the growth was due to business in the Middle East (“we will see significant further expansion there in the next six to 12 months”), continuing growth identified by Chris in 2012 (post). Turkey and Italy were also identified as particularly strong market opportunities.

The report is also EMEA-only – it excludes revenues from selling the 4Projects solution – or Viewpoint for Collaboration as it is there known – in the Australasian and north American markets (“we are happy with the momentum achieved there”). This makes the increase in overseas revenues even more significant, and 4Projects is investing in its international channel partners programme to develop this still further (Michael Romero will be joining 4Projects from Asta to lead this expansion, I understand).

Steve told me 4Projects has also been benefiting from more customers adopting an enterprise approach to collaboration rather than thinking project-by-project. Another trend was that more asset owner/operators are starting to use the platform, in both the pre- and post-construction phases of the asset lifecycle.

4BIM

Building information modelling is also a strong factor in uptake of the 4Projects solution, he said, particularly among asset owners. Having participated in Viewpoint’s user conference in the US last month, the team believed there was substantial American interest in the core product (“the market is now understanding the connection between collaboration and ERP,” said Alun), and in adoption of BIM-based approaches. The UK’s BIM programme is also opening doors for them; Steve told me:

“While some are interested in the big BIM picture, others just want the earlier base functionality, knowing that they can extend to the other 4Projects functionality, like BIM, when they need to.”

Alun talked of a five-year development programme at 4Projects which envisages growing numbers of organisations migrating to SaaS-based BIM solutions so that they can apply real-time collaboration approaches, integrate asset data with other business informatics (he mentioned ‘Big Data’ in this context), and provide “clear ROI measures to the whole value chain” (see my previous post: A BIM boom for SaaS collaboration vendors?).

My view

From the published results of all the leading UK-based SaaS collaboration vendors, it appears the corner has well and truly been turned, though some took longer to return to growth than others. If industry predictions about construction market growth are correct, we should see these upward trends maintained for the next few years, but the angle of travel may vary according to the relative strengths of the different solutions in a changing technology market.

As I suggested in my ‘BIM boom’ post, adoption of BIM is likely to prove only a gradual boost to the fortunes of leading vendors, but is also likely to change the complexion of the vendors’ customer base. As 4Projects are finding, asset owner/operators are likely to be more motivated to look at whole-life information management, and rather than leaving system selection up to their Tier 1 contractors, may mandate a selected system so that all their asset information is collated in one platform. This can then be integrated with other business systems to provide greater visibility of the impact of asset operations on business performance.

Update (4 November 2014) – Viewpoint has reported on its EMEA operations; see news release. It notes the company added 20 new team members in the last 12 months, and quotes EMEA MD Alun Baker:

“Our customers and the construction market recognize the commitment we are making to both product and team development and this shows in the number of new customers we’ve gained over the year. Much of our growth has been seen in greater adoption by asset owners and operators using the product in both the pre- and post- construction phases of the asset lifecycle, and also customers adopting the product at an enterprise level versus on a project basis. We have also recently increased investments in expanding and developing both our direct sales channel and our international channel partner programme.”