Wednesday, 10 June 2009

SDL translates to Pomme

(By Anthony Miller – Wednesday 10th June 2009 9:15am). That’s ‘apple’ in French, according to SDL’s free translation website. I mention this because I met up yesterday with SDL’s ebullient founding executive chairman, Mark Lancaster and was just blown away with what this company is doing.

We’ve been tracking SDL for years – just take a peek at the 2000 Holway Report and you’ll see that SDL’s revenues rose 28% in 1999 to £13m but they made an £800k pre-tax loss. Even so, the company was worth £107m at a 318p share price (this was in April 2000!). Last year SDL reported £159m in revenues and nearly £20m in pre-tax profit. As I check the markets just now, its shares sit at 342p valuing the company at £255m (and see SDL translates service into profit).

But what of the Apple connection? Well, they’ve recently developed an app for the iPhone/iTouch which let’s you translate simple phrases ‘on the move’. It’s in the process of being authorised for Apple’s app shop, but is downloadable for free on SDL’s website. SDL is already getting nearly 80k hits a month from the app and hopes to earn a small income from it when it goes ‘official’.

As I pointed out in our Feb. ’09 posting, SDL is primarily a SaaS business, with some 85% of its revenues deriving from its translation services. Even in its enterprise customers, 30% of revenues are ‘true’ SaaS-based, and 80% of the rest, who buy its technology through a traditional perpetual licence, contract with SDL to host the software.

We’ll write more on SDL as I think the ‘freebie’ angle is really interesting in the way they hook prospects into the service (now I come to think of it, that’s what UKHotViews is all about too!) - just try Googling ‘translator’ and their free website will be among the top hits. Apparently SDL’s freebie washes its face financially and brings them excellent visibility. Also we absolutely need to talk more about ‘Little British Battlers’ like SDL (and of course, not so little Autonomy) who are also ‘global stars’. SDL (also like Autonomy) doesn’t appear in our CompanyViews UK Software Rankings as over 90% of their revenues derive from overseas. It’s a great story and one that deserves the telling.

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