NETSOL Technologies (NASDAQ:NTWK) announced its fourth quarter and full year financial results with the company reporting revenues of US$16.6 million. Meanwhile, the company’s total net revenues for the fiscal 2018 were US$60.9 million as compared to US$65.4 million in the prior year period. As quoted in the press release: “The fiscal fourth quarter was a … Continued
NETSOL Technologies (NASDAQ:NTWK) announced its fourth quarter and full year financial results with the company reporting revenues of US$16.6 million.
Meanwhile, the company’s total net revenues for the fiscal 2018 were US$60.9 million as compared to US$65.4 million in the prior year period.
As quoted in the press release:
“The fiscal fourth quarter was a solid end to an eventful year for NETSOL, both financially and operationally,” said NETSOL Co-Founder, Chairman and Chief Executive Officer Najeeb Ghauri. “From a financial perspective, we successfully achieved our third consecutive quarter of profitability, grew our topline 15% over the fourth quarter of the prior year as well as continued to improve our cost structure and efficiencies. In fact, our overall cost reduction initiatives have now resulted in $8.5 million of savings through fiscal 2018, which was a major driving factor in us realizing the $9.3 million increase in annual net income over last year. On top of this, in the fourth quarter alone, we were able to generate $1.8 million in savings on costs of revenues and another $500,000 from operating expenses. These initiatives have not only made NETSOL a more nimble and efficient organization, but they’ve also provided additional bandwidth, with minimal incremental cost, for us to scale our business in fiscal 2019 and beyond.”
Full Year Fiscal 2018 Financial Results
Total net revenues for fiscal 2018 were $60.9 million, compared to $65.4 million in fiscal 2017. The decrease in total net revenues was primarily due to a decrease in total license fees of $11.6 million, which was offset by an increase in total maintenance fees of $332,000 and an increase in total services revenues of $6.8 million.
Total license fees were $6.9 million, compared with $18.5 million in the prior fiscal year.
Total maintenance fees were $14.8 million, compared with $14.5 million in the prior fiscal year.
Total services revenues were $39.3 million, compared with $32.4 million in the prior fiscal year.
Gross profit for fiscal 2018 increased to $29.2 million (or 47.9% of net revenues) from $28.4 million (or 43.5% of net revenues) for fiscal 2017. The increase in gross profit as a percentage of net revenues was primarily due to a decrease in costs of revenues of $5.2 million.
Operating expenses for fiscal 2018 decreased to $26.2 million (or 42.9% of net revenues) from $29.4 million (or 45.0% of net revenues) for fiscal 2017. The decrease in operating expenses was primarily due to decreases in selling and marketing expenses and provision for bad debts, which was offset by an increase in research and development expenses.
GAAP net income attributable to NETSOL for fiscal 2018 totaled $4.3 million or $0.38 per diluted share, an improvement from net loss of $5.0 million or $(0.46) per diluted share for fiscal 2017.
“Fiscal 2018 has been a turnaround year for sales and NETSOL as a whole with several tier-one clients entering into new IT selection processes and Ascent making the shortlist in each occurrence,” added President and Head of Sales Naeem Ghauri. “After closing out the previous fiscal year and starting the current one with back-to-back wins in China, we are upbeat and motivated to capitalize on this building momentum. We remain confident in our ability to finish strong and secure further wins in fiscal 2019.”