Acquisition of RosterOn in Australia

RNS Number : 7711J

Allocate Software PLC

05 July 2011

 



5 July 2011

ALLOCATE SOFTWARE PLC

("Allocate" or "the Company")

Acquisition of RosterOn in Australia

Allocate Software plc announces that it has acquired RosterOn Pty Ltd ("RosterOn"), an Australian based provider of workforce management software with a focus on the Australian healthcare market, for A$3.0 million (£2.0 million)¹ (the "Acquisition"). This gives Allocate a much stronger local presence and is in line with its ambitious growth plans for the Australian healthcare market.

Overview of RosterOn and the Acquisition

§ RosterOn is a leading, local Australian provider of staff rostering software, principally for the Australian healthcare market

§ RosterOn has product functionality complementary to Allocate's, including an Awards interpretation engine tailored specifically for the Australian Market (complex rules relating to salary fixing arrangements)

§ c. 70% of revenues come from RosterOn's 43 healthcare customers  according to unaudited management accounts, with the balance spread across multiple sectors including mining, logistics, manufacturing and retail

§ In the year ended 30 June 2011, unaudited management accounts show c. A$3.0 million in revenues and approximately A$0.6 million in EBITA

§ All 17 RosterOn employees will be retained

§ Upfront consideration of A$2.6 million payable in cash with further consideration of A$0.4 million payable in cash and in full upon the retention of the key directors of RosterOn for 18 months from completion

§ The Board believes the acquisition will accelerate the expansion of Allocate's business in Australia and that it will be earnings enhancing, before one time deal costs, in the financial year to 31 May 2012

Information on RosterOn

RosterOn was founded in 2002 and is based outside Melbourne, Victoria, Australia. It is a leading provider of rostering, labour management, and time & attendance software in Australia. RosterOn has developed an interpretation engine specifically for Australian Awards - complex rules for wage fixing arrangements relating to minimum pay, minimum number of breaks per hour, minimum level of overtime compensation and pay related activities (e.g. working through a break).

Customer Base

All of RosterOn's customers are based in Australia.

As at 31 May 2011, RosterOn had 68 customers, 43 of which are in the healthcare sector.  RosterOn's installed base is therefore a complementary fit to Allocate's existing presence in Australia, with two state wide projects underway, as previously announced.

Technical Environment

The front-end of RosterOn's core product is implemented using C++ .NET with an SQL server back-end and has been developed by RosterOn using industry standard tools. Allocate has conducted detailed technical due diligence and believes that the technology architecture is robust and scalable.

Management and Employees of RosterOn

The Company does not expect a complex integration of RosterOn into the Allocate group. Key members of RosterOn's management and all of the team are expected to remain in place after the Acquisition.

Acquisition Rationale

Given Allocate's ambitious growth plans for the local market, the Board believes that this acquisition will accelerate the expansion of its presence in the Australian healthcare market.  The acquisition of a local provider of workforce management software with an established installed base in the Australian healthcare market leverages Allocate's strategy to provide scale and resources to accelerate its growth in the region.

Commenting on the Acquisition, Ian Bowles, CEO of Allocate, said: "I am delighted to have completed this, our fifth acquisition. Acquiring RosterOn reinforces our commitment to the local market and consolidates our position in the Australian healthcare sector. Furthermore, RosterOn brings additional domain expertise and complimentary applications functionality for Healthcare in Australia.  I believe this is a timely opportunity to add scale and expertise to our existing Australian operations and I am very pleased that both of the founders, Dean and Peter will remain with the Allocate Group, reporting to Peter Croft, our General Manager for Australia and New Zealand."

Dean Seeley and Peter Collins, founders and directors of RosterOn, said: "The strategic fit between Allocate and RosterOn is excellent for both customers and staff.  Healthcare has emerged as one of the most exciting areas of the workforce management software market and the enlarged group is well positioned to exploit this opportunity.  In addition, our installed base of 25 customers in sectors outside of healthcare is complementary to Allocate's opportunities for development in Australia.  We look forward to contributing to their continued strong growth."

Final Results FY11 date

In its Q4 Update and Contract Wins, the Company announced that it would release its FY11 year end results w/c 8th August. The Company has now decided to move that date to September 5th in order to enable the optimal level of resource to be applied in the first 30 days of this acquisition.

Enquiries:

Allocate Software plc Ian Bowles - Chief Executive Officer Chris Gale - Chief Financial Officer	Tel: [phone]
Strata Partners (Financial Adviser) Edward Roskill Alistair Armstrong-Brown	Tel: [phone]
Numis Securities Limited (NOMAD / Corporate Broker) Nominated adviser - Michael Meade Corporate Broking - James Black	Tel: [phone]
Gable Communications Justine James John Bick	Tel: [phone]        [phone]

About Allocate Software plc

Allocate Software plc is the leading workforce and compliance optimisation software applications provider for world-wide organisations with large, multi-skilled workforces.  With a blue chip client base spanning the public and private sector, its key vertical markets include: Healthcare, Defence and Maritime.

At the core of the business is Allocate's workforce optimisation software, which organisations use to deploy the right people with the right skills, to the right place at the right time.  Headquartered in London, Allocate provides services and support to its increasing international customer base through regional offices in the UK, Sweden, USA, Australia and Malaysia.

Allocate is quoted on the London Stock Exchange (AIM: ALL).  For further information please visit www.allocatesoftware.com.

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¹ £1 = A$1.50 as at 1 July 2011

 

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