RealTime IT News

Melbourne IT Quadruples Earnings

[Sydney, AUSTRALIA] Melbourne IT today reported an EBIT of $3 million (US$1.8 million) for the half year ended 30 June 2000, an increase of 435 percent over the corresponding period last year. Net profit after tax was $2.2 million (US $1.3 million).

Revenue of $23.1 million for the half year is up 401 percent and already nearing the prospectus forecast for the full year of $24 million.

The performance in .com.au domain name registrations, over which Melbourne IT holds a monopoly, was described as "solid". Melbourne IT said the highlight of its results was the performance of its Internet Names Worldwide division which registered over 800,000 global top level domain names (gTLD's - .com, .org and .net) during the six months, its market share increasing from 6 percent in the March quarter to 8 percent in the June quarter.

Chief Executive Officer of Melbourne IT, Professor Peter Gerrand said the company was concentrating its global marketing in those areas where customers are prepared to pay extra for service and technical features, but that retail and wholesale prices continue to be pushed down due to global pricing pressures. He conceded that the total volume of gTLD registrations was also falling, predicting the number of gTLD registrations to be significantly lower this quarter.

The company is responding to the increased price pressure by placing a tight rein on expenses in the short term and attempting to diversify its business through opening up new market sectors such as chinese character domains; developing registration capabilities in other country codes where price competition is less intense; and bidding for a position as the co-operator of a registry in the new top level domains which ICANN has announced will come into operation in 2001. Melbourne IT also plans to move into the sale of additional e-commerce products such as digital certificates. It has established a joint venture with Ericsson to develop secure mobile e-commerce products for the global market.

Addressing the issue of competition in registering .com.au domains, due to be introduced imminently, Gerand said "we are confident that the policy framework that introduces competition will extend to 90% of the .au space, and will vastly increase the overall market in .au domain names that we will target."