Aussie tech's biggest winners and losers on the ASX in 2017

The Australian Securities Exchange is a hotbed of technology activity. The sharemarket includes longstanding IT and telco players, such as Telstra, Data#3 and Dicker Data, along with many smaller tech companies looking to grow their business.

The past year has shown the pros and cons of going public. While some companies have surged ahead and delivered strong shareholder returns, others will be under scrutiny from investors for failing to live up to expectations.

While the All Ordinaries index rose 7.9 percent from the end of 2016 to the end of 2017, the majority of the technology companies on this list saw their value fall over the course of the year.

Here we present more than 20 of the top ICT firms on the ASX, ordered from those with the most buoyant share price performance in 2017 to the companies with the worst returns.

Kogan

CEO Ruslan Kogan

30 December 2016 $1.34

29 December 2017 $6.75

Change 403.73%

Current price (2 February 2017): $7.67

Kogan has seen its share price grow exponentially from its post-IPO share price of $1.80 in 2016 to $6.75 at the end of last year, with the Sydney Morning Herald calling it the best performing stock on the ASX All Ordinaries index in 2017.

In its first full year as a publicly traded company, the online retailer posted revenues of $289.5 million for the 12 months to 30 June 2017, growing 37.1 percent from the year previous, with a net profit of $7.2 million, an 800 percent increase on last year's $800,000.

Kogan also saw its customer base edge close to one million at 955,000, up 36 percent from 2016. It also garnered 6.5 million active subscribers through retail, travel, mobile, insurance marketplace and NBN brands, as well as through its acquisition of the Dick Smith brand, and partnerships with eBay and TradeMe.

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Melbourne IT

CEO Martin Mercer

30 December 2016 $1.86

29 December 2017 $3.62

Change 94.62%

Current price (2 February 2017): $3.40

Melbourne IT reports on a calendar year, and announced solid growth in revenue, earnings and profits for the six months to 30 June 2017. H1 revenue was up 11 percent to $91.7 million, EBITDA was up 37 percent to $15.3 million and net profit after tax was up 253.4 percent to $7.9 million.

The company in May announced the $39 million acquisition of digital marketing solutions provider WME Group, which provides search engine optimisation (SEO), advertising and web design. Brands within the group include WME, Nothing But Web and Results First.

Melbourne IT was also among 20 companies named in Gartner's Public Cloud Infrastructure Managed Service Providers Worldwide report.

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Rhipe

CEO Dominic O'Hanlon

30 December 2016 $0.50

29 December 2017 $0.85

Change 70%

Current price (2 February 2017): $0.96

Rhipe beat its revenue forecast for 2017 by hitting $157 million in the 12 months leading up to 30 June that year, up 15 percent from the same period in 2016.

The cloud software distributor also saw 70 percent growth in South East Asian licensing revenue, and 16 percent overall licensing revenue growth to $151.8 million. Its public cloud business grew to 130,000 seats, more than doubling from last year’s reported 54,000, and constituting recurring revenue in excess of $22 million.

Microsoft appointed Rhipe as Asia-Pacific’s sole globally managed licensing partner, joining only seven others in the world. Other partnerships include eSignature specialist DocuSign and Symantec.

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Dicker Data

CEO David Dicker

30 December 2016 $2.25

29 December 2017 $2.99

Change 30.67%

Current price (2 February 2017): $2.85

Dicker Data celebrates its 40th year in business in 2018 after first being incorporated in 1978. The Sydney-headquartered distributor crossed the $1 billion revenue milestone in 2015, a year after its blockbuster acquisition of Express Data.

The distributor, which has a market capitalisation of almost $500 million, also added some big names to its portfolio including Juniper Networks, Hitachi and Dell EMC while also extending its HPE Aruba and Nimble storage deals to New Zealand after losing Cisco to Westcon-Comstor in August.

Other additions include Melbourne-based Venom Computers, ASX-listed IoT startup CCP Technologies, Symantec's Blue Coat, Pure Storage, BenQ, Trend Micro and TeamViewer.

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DWS

CEO Danny Wallis

30 December 2016 $1.30

29 December 2017 $1.67

Change 28.46%

Current price (2 February 2017): $1.62

DWS' shares climbed from $1.48 in February to a high of $1.87 in the months following the Melbourne-based IT services provider's announced plans to acquire fellow body shopping form SMS Management and Technology for $124 million.

Shares fell to $1.58 after ASG revealed a rival bid for SMS. ASG won the bidding war for SMS in June, leaving DWS to continue to look for suitable acquisition targets.

The company also trimmed 100 contractors in the 2017 financial year in order to protect its profitability, which increased five percent to $17.7 million.

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Macquarie Telecom

CEO David Tudehope

30 December 2016 $12.20

29 December 2017 $15.11

Change 23.85%

Current price (2 February 2017): $15.40

Macquarie Telecom's share price got a nice bump when it announced its intention to acquire Bulletproof in November, climbing from $14.39 to $15.24 a fortnight later. Bulletproof advised shareholders to reject the offer, and the potential acquisition is still being negotiated.

The company had an impressive year on its own, becoming just the third firm to achieve Protected accreditation for its government cloud services.

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Data#3

CEO Laurence Baynham

30 December 2016 $1.53

29 December 2017 $1.81

Change 18.32%

Current price (2 February 2017): $1.64

In its 20th year as a publicly listed company, Data#3's share price hit a record high of $2 in December, doubling in price since April 2016.

Last year also saw Data#3 hit a billion dollars in revenue for the first time, with net profits of $15.4 million and a market capitalisation of $300 million.

The company split its shares in 2011 when they traded at $12 each, dividing the price and volume by 10 in order to increase liquidity.

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TPG

CEO David Teo

30 December 2016 $6.82

29 December 2017 $6.57

Change -3.66%

Current price (2 February 2017): $6.55

TPG announced record results the 2017 financial year, reaching revenue of $2.5 billion, EBITDA of $890.8 million and net profit of $413.8 million.

The telco saw its broadband subscriptions reach 1.94 million by the end of FY17, split 979,000 for iiNet and 957,000 for TPG.

However, the telco's share price has taken a major tumble since hitting $12.83 in July 2016, which is blamed in part on "margin erosion faced by the industry in light of the NBN".

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Empired

CEO Russell Baskerville

30 December 2016 $0.52

29 December 2017 $0.47

Change -9.61%

Current price (2 February 2017): $0.48

Empired said its "recovery year" had paid off after a rough 2016, as the company's performance improved for the financial year ending 30 June 2017.

The annual report showed revenue was up 5 percent to reach $168 million. Earnings more than doubled to $15.4 million.

The company announced several wins, including a deal to roll out Dynamics 365 to 6000 users for entertainment and tourism group SkyCity in Australia and New Zealand, and it was also chosen as a key subcontractor to Western Australia's whole-of-government IT procurement panel under NEC Australia.

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JB Hi-Fi

CEO Richard Murray

30 December 2016 $28.04

29 December 2017 $24.94

Change -11.06%

Current price (2 February 2017): $28.39

JB Hi-Fi was named in Deloitte’s Global Powers of Retailing 2018 report as one of the biggest retailers in the world, debuting at 218th place with revenues of $5.3 billion in the 2017 financial year and net income of $162 million. The retailer joins only two other Australian companies, Wesfarmers and Woolworths.

The revenue growth was anchored by its acquisition of whitegoods retailer The Good Guys in 2016, bringing in $1.26 billion in sales to overall revenue.

JB Hi-Fi expects to reach its synergy target of between $15 million and $20 million resulting from the acquisition in FY19, a year earlier than anticipated.

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Superloop

CEO Bevan Slattery

30 December 2016 $2.74

29 December 2017 $2.42

Change -11.68%

Current price (2 February 2017): $2.39

The 2017 year included contribution from one of Superloop's biggest acquisitions, BigAir, which was acquired in September 2016.

Superloop's revenue was up 755 percent to $59.8 million following the acquisition, with underlying EBITDA of $9 million, up from a $5.6 million loss, and a net loss fater tax of $1.2 million, which was an improvement over 2016's loss of $7.2 million.

The company appointed some major talent in 2017, including naming iiNet founder Michael Malone as executive chairman, and hiring Dan Whitford, formerly Vocus Communications general manager of wholesale.

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Pictured: Michael Malone, founder of iiNet

TechnologyOne

CEO Edward Chung

30 December 2016 $5.65

29 December 2017 $4.96

Change -12.21%

Current price (2 February 2017): $4.90

TechnologyOne reported a growth in revenue and profit for its full year to 30 September 2017.

The company turned over $273 million in revenue and boasted of fast growth of its cloud push.

However, the year was also dominated by its feud with Brisbane City Council over the troubled local government systems (LGS) project, which raged throughout 2017 but was settled in December.

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Pictured: Adrian Di Marco, chairman of Technology One

Harvey Norman

CEO Katie Page

30 December 2016 $5.14

29 December 2017 $4.17

Change 18.87%

Current price (2 February 2017): $4.49

Harvey Norman's shares went through a rollercoaster ride in 2017, dropping from $5.14 to a low of $3.62 in June.

The retail giant admitted early in the year that it was under investigation by the Australian Securities and Investments Commission over how it accounted for its franchises, focusing on whether the accounts of franchise stores should be consolidated.

Despite bouncing share price, the company reported record profits of $449 million for the year.

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Vocus

CEO Geoff Horth

30 December 2016 $3.87

29 December 2017 $3.03

Change -21.71%

Current price (2 February 2017): $3.25

Vocus is currently facing class action from disgruntled shareholders over the telco's falling share price. Shareholders claim the company participated in "misleading and deceptive conduct" with claims that it overstated its guidance for FY17.

In November, Vocus forecast revenue of $1.9 billion, EBITDA of $430-450 million and NPAT of $205-$215 million. On 2 May 2017, it revised its forecast down to revenue of $1.8 billion, EBITDA of $365-$375 million and NPAT of $160-$165 million.

Shares lost more than 65 percent of their value in the 12 months leading to the class action, falling from $7.00 in September 2016 to trade at $2.41 in September 2017.

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PS&C Group

CEO Glenn Fielding

30 December 2016 $0.30

29 December 2017 $0.23

Change -23.33%

Current price (2 February 2017): $0.20

The Melbourne-headquartered IT solution provider, which was born out of several acquisitions, saw its revenue sink 13 percent to $73.9 million and its normalised EBIT down 27 percent to $5.8 million.

PS&C made a number of acquisitions in the period, including Sacon Group and Coroma Consulting in June.

PS&C also announced a new managing director earlier in 2017. Glenn Fielding joined after a long career in IT including roles at UXC, DWS and SMS.

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Telstra

CEO Andy Penn

30 December 2016 $5.09

29 December 2017 $3.63

Change -28.68%

Current price (2 February 2017): $3.67

Telstra announced in August that it would no longer pay out almost 100 percent of net profits to its shareholders, and will offer between 70 and 90 percent instead.

Chairman John Mullen said the retained profits would be used to help future proof Telstra's business, including plugging the $3 billion hole that will be left in the wake of the NBN's completion.

Telstra chief executive used his keynote speech at the Telstra Vantage conference to apologise to shareholders, saying he lost sleep over the decision but knew it was the right one to make for the future of the company.

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MOQdigital

CEO Joe D'Addio

30 December 2016 $0.34

29 December 2017 $0.23

Change -32.35%

Current price (2 February 2017): $0.24

MOQdigital, which was Microsoft’s Australia country partner of the year for 2016, reported revenue of $54.7 million in 2017, up 62 percent thanks to the impact of two acquisitions as well as strong organic growth.

MOQ touted growth across all lines of business, with recurring revenue up 123 percent to $10.8 million, professional services up 40 percent to $15 million and its reselling business up 58 percent to $29 million.

The year was not been without its upheaval, with chief executive Nicki Page resigning in April and director Don Francis, the founder of acquired company Tetran, resigning in July.

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Pictured: David Shein, non-executive chairman of MOQdigital

CSG

CEO Julie-Ann Kerin

30 December 2016 $0.73

29 December 2017 $0.45

Change -38.36%

Current price (2 February 2017): $0.48

CSG missed financial expectations for the financial year ending 30 June 2017, writing down the goodwill of its print business by $55 million as a result. The print and IT provider posted revenue of $245 million last year, a drop of $1.1 million from 2016, which the company said was below expectations. Underlying EBITDA was $30.3 million.

The result was anchored by a $7 million shortfall in the enterprise solutions business, consisting of $4 million in transactional equipment revenue for an enterprise managed print contract, and $3 million from an IT managed services contract that is still in the pipeline.

However, CSG also increased the customer base of its 'as-a-subscription' product suite to 27,300 seats, adding 9200 "low-value seats" after spending NZ$300,000 to acquire PC Media, a New Zealand managed IT services and Microsoft cloud partner.

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Bulletproof

CEO Anthony Woodward

30 December 2016 $0.25

29 December 2017 $0.13

Change -48%

Current price (2 February 2017): $0.14

Bulletproof had a tough 2017, reporting a $6.1 million loss in August despite revenue growing four percent to reach $49.2 million.

The company was hit with legal action over the acquisition of New Zealand's Cloud House it made in 2016 when the target claimed Bulletproof mismanaged its business to avoid earn-out payments. The matter has since gone to court, with Bulletproof strongly denying the claims.

Bulletproof's share price has been the focus of a potential battle to acquire the cloud provider towards the end of last year. Macquarie Telecom put in a bid for Bulletproof, offering to pay $0.11 for each share, based on a 65 percent premium on its last closing price of $0.067. Bulletproof rejected the offer, saying it was based on a historic low share price.

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Vita Group

CEO Maxine Horne

30 December 2016 $3.23

29 December 2017 $1.43

Change -55.73%

Current price (2 February 2017): $1.81

Vita's shares dropped 30 percent to $1.52 in May after announcing that Telstra was reorganising its stores into "geographic clusters" and hinted at changes to its remuneration agreement.

Later that month, Vita revealed the extent of the remuneration cuts: 10 percent in 2017, followed by two more 10 percent cuts in 2019 and 2020.

Vita, which is Telstra's only master licensee partner, copped the cuts in exchange for permission to open a wider store footprint. Revenue in the 2017 financial year was down five percent as a direct result.

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Hills

CEO David Lenz

30 December 2016 $0.46

29 December 2017 $0.20

Change -56.52%

Current price (2 February 2017): $0.26

Hills posted a net loss of $7.9 million for the financial year ending 30 June 2017, an improvement on the prior year's loss of $68 million. Revenue was down $31 million to $298 million for the year.

The distributor has so far spent $53 million on restructuring and transformation over the past five years, supported by the sale of many of its old assets.

Hills however expects to return to trading profit in the second half of the 2018 financial year, the distributor announced during its 2017 annual general meeting, addressing moves to return to profitability after a disappointing run of losses.

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Inabox Group

CEO Damian Kay

30 December 2016 $1.27

29 December 2017 $0.49

Change -61.42%

Current price (2 February 2017): $0.52

Inabox shares took a hammering last year when it was revealed that the $7 million acquisition of Hostworks hadn't gone as smoothly as expected.

The company expected Hostworks to contribute $21.8 million in revenue and $3.5 million in earnings in the 2018 financial year. Hostworks actually would contribute only $15 million with negligible earnings and an overall net loss.

Inabox shares fell nearly 48 percent after the reveal.

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