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Micro Focus; 30 per cent up and still growing

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CIOL Bureau
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BANGALORE, INDIA: The year 2011 has been a tough one for British software company Micro Focus, when it ran into problems. The company was rumoured to be on the verge of acquisition, its share prices were plunging southwards, and its 50-year-old Cobol was termed dead by critics.

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However, things have changed during the past one year, and in an interview with CIOL's Deepa Damodaran, David Taylor, president, Micro Focus Asia Pacific & Japan tells us how. Excerpts:

CIOL: What happened last year?

David Taylor: Some venture capitalists were looking to acquire us. However, their offers were rejected by the Board.

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There were several similar rumours being floated by a few, and many were trying to take advantage of the situation. Since we were not doing well in the share market, we could have been an easy target.

However, during the course of past one year, we almost doubled our share prices. Now, we are more expensive than what we were a year back. I am not aware of anyone who is talking to us with regards to acquisition now.

Today, we are delivering on our revenue and profit expectations, and are a healthy company now.

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CIOL: What changed during this one year?

DT: A lot of new things that we were working on started to click. For example, we did a lot of work around the migration space during the global financial crisis in 2008, which helped our business a lot.

We recognised that along with building software applications, we need to look into software testing, too. So back in 2009 we acquired Borland and the testing division of Compuware and brought out our test server and technology. A lot of companies started using it.

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At the same time, a lot of work around Visual Cobol products that we had talked about was being done and was brought into the market.

All these were happening since 2009, and we set our expectation high for 2010. However,

we did not meet it. We were a bit over ambitious then. Now, things have changed. It took us a year longer to achieve it though.

During the crisis, our chairman took the role of CEO, built a strong management team, and brought in some key executives into the organisation. So fingers crossed, we will play it out this year as well.

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CIOL: How ambitious are you this year?

DT: I know I have to be careful with what I say. However, we have had a fantastic time this year. The growth in our region was around 25 per cent.

North America as an economy is improving, Europe is still in crisis for everybody. However, we are very positive and are seeing some business there.

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We will open a new office in Shanghai. We are expanding our operations in India as well, and are hiring.

For the next year around, we will set a realistic expectation for the market, and will not be silly by keeping it high. However, internally we are very ambitious for the future.

CIOL: What will be this realistic growth in numbers?

DT: With respect to next year, I cannot share the figures. However, this year across the region, including Australia, New Zealand, Japan, all of Asia and India, we saw a growth between 25-30 per cent. India's growth has been higher than this.

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