WeDo Enjoy 12% Growth

WeDo, the Portuguese suppliers of business assurance software, have announced their FY13 revenues were EUR61.5mn (USD83mn), up 12% compared to the previous year. This continued growth consolidates their position as market leaders. EBITDA rose 36% to EUR11.8mn (USD16mn). There was no mention of profits.

The company identified Southern Europe, Middle East and Africa as the regions that contributed most to growth. They also reiterated their strategy of expanding sales to the retail, energy and finance industries, claiming they now have 31 non-telco customers. On Thursday, Chief Marketing Officer Sergio Silvestre separately mentioned that sales to non-telecoms customers now generates about 10% of WeDo’s revenues. WeDo’s continued expansion outside of telecoms comes as no surprise; in January the firm created a new VP role with responsibility for developing their business outside of telecoms.

WeDo’s strong performance suggests their corporate strategy is working and hence needs little change, or further analysis. There are signs that the market is contracting overall, which makes WeDo’s results especially impressive. In his choice of words for the press release, CFO Fernando Videira hinted at some underlying softness in the market (my emphasis):

This level of continued innovation, top line growth, as well as sustainable EBITDA growth, is evidence that WeDo will continue to gain market share and to be the biggest and most robust player in Revenue Assurance and Fraud Management software in the world.

Videira went on to signal the scale of WeDo’s ambition, saying he wanted revenues to reach USD100mn by 2015. It is also worth noting that WeDo’s messages have changed subtly over the years. In the past, they asserted themselves to be leaders in the sphere of revenue assurance, excluding fraud management. Now they clearly prefer to measure their performance against the combined RA and FMS market.

Having attained the position of market leader, WeDo can exploit the advantages this confers, compared to their rivals. As the customer base grows, the same expenditure on maintaining and developing products represents a smaller proportion of the revenues they receive. WeDo also benefits from the viral marketing effect of loyal customers recommending WeDo to their peers, or seeking to purchase relevant WeDo products when they move to a new employer. WeDo’s keenness to tell telco people about their non-telco sales may partly be motivated by the hope that practitioners will continue to advocate business assurance and WeDo, even if they leave telecoms to take jobs in other sectors.

In summary, WeDo’s strategy is established, coherent, and appears to be succeeding. That allows their management team to focus on execution, making high quality sales, and sustainably improving their income.

Eric Priezkalns
Eric Priezkalns
Eric is the Editor of Commsrisk. Look here for more about the history of Commsrisk and the role played by Eric.

Eric is also the Director of the Risk & Assurance Group (RAG), a global association of professionals working in risk management and business assurance for communications providers.

Previously Eric was Director of Risk Management for Qatar Telecom and he has worked with Cable & Wireless, T‑Mobile, Sky, Worldcom and other telcos. He was lead author of Revenue Assurance: Expert Opinions for Communications Providers, published by CRC Press. He is a qualified chartered accountant, with degrees in information systems, and in mathematics and philosophy.