Ramco issued solid Q2 2020-21 results this week. Notable highlights in the quarter included a reduction in its borrowings and a record EBITDA. It also signed five deals worth more than a million, hinting that its move upmarket is successful.
P.R. Venketrama Raja, Chairman, Ramco Systems, commented: “The thrust we place on building our unique strength around Innovation, depth of offering and delivering customer delight have together helped us carve a niche position in the market. Having established our strong footprint in Asia and Middle East, we are now seeing a sizeable traction and growth coming from U.S and Australia, too. Overall, Q2 witnessed all business units and regions contributing to our growth trajectory. Together with our measures to keep operational efficiency high, we hope to continue this growth momentum in the coming quarters too.”
Key figures from the results were:
- Quarterly revenues USD 21.56 million 9.85% growth year over year
- Quarterly order bookings stood at USD 26.53million, 24% growth over Q1
- Net profit after tax USD 2.25 million
- Earnings per share USD 0.07
Ramco also repaid USD 3.21 million of its loans, reducing its borrowings to USD 6.78 million, a year ago in September 2019 they stood at USD 13.11 million.
Led by Aviation
Ramco Aviation is still the jewel in the crown for the company. In this quarter it launched the latest version of Ramco Aviation Suite, V5.8.9. This included an updated UI, new AI/ML-powered features and improvements to mobile applications.
It also increased its domination of the helicopter OEM market signing another leading company. Ramco also signed up CHI Aviation a leading U.S. headquartered helicopter services provider.
Its other solutions also saw further investment. Ramco Payroll is now available for more than 50 countries, and it will add more African and European countries in 2021. It now has more than five global MNCs looking to consolidate their payroll onto the platform. To further support employers bringing employees back into the workplace, it launched a solution in combinations with Navigine and Hipla technologies as part of its #BackToWork initiative.
Its ERP continues to win Asian logistics businesses. Toll Logistics signed a deal for its chemical operations in ANZ. It will then look to roll out the solution across its Asian operations.
Enterprise Times: What does this mean
A solid set of results, seemingly unaffected by the current pandemic. Ramco acknowledged the risk of uncertainty created by the pandemic but stated: “there is no material impact in respect of these (possible impacts of COVID-19) in the preparation of the unaudited quarterly consolidated financial results”.
While competitors have seen a significant boost in bookings, Ramco bookings rose by only 2% year over year from USD 26.01 to USD 26.53. It preferred to flag the increase from Q1, though there was a similar rise last year. A 2% rise is negligible compared to other SaaS vendors, and while it is growing market share, it does not appear to be doing so at the same rate as others.
The good news is that it is profitable and repaying debts. Is it putting itself in a position to either seek more funding to accelerate growth or possibly for sale? Ramco has several attractive assets, including a solid customer list and some leading technology. P.R. Venketrama Raja infers that once again Ramco is poised to take advantage, the challenge is whether it has enough people on the ground to make the sales and bring in even more deals.
While it has an impressive list of SI’s on its partner page, it does not appear to have many channel partners listed. The big question is that with many companies looking to accelerate a move to the cloud, does Ramco have the resources to capture more market share with its leading technology or will it miss out on the opportunity?
Additional funding would help grow its Sales and Marketing functions