Lion NZ takes a hit following multi-million tech investment
New Zealand’s leading alcohol beverage company Lion NZ took a hit to net profit last year due to multi-million-dollar IT investment, but is hoping the tech transformation will reap rewards for the business in the long-term.
Net profit after tax of $28 million for the year to December 31 was down from $75.6m in the 15 months to December 2017, while sales revenue of $593m was up from $585m recorded in the 2017 financial year.
Lion’s “once-in-a-generation IT transformation”, which went live in September 2018, is expected to modernise the business for a rapidly evolving market.
“Lion is the first company in Australasia to bring the SAP S4Hana system into the cloud,” Rory Glass, Lion NZ managing director said in a statement.
“Transformation like this is not for the faint hearted but in order to set Lion up for the long-term we accepted that there would be a short-term impact.”
Glass said customers expect an easy and convenient experience similar to that provided by Uber or Amazon.
“Over time this will revolutionise our business and when fully optimised, we’ll be able to provide a real time customer delivery experience and seamlessly update to new technology as it emerges. Things like predictive analytics, facial recognition and artificial intelligence are now within our reach.”
Glass acknowledged Lion’s customers and people for their support and resilience during a year of disruption, noting that topline sales growth is continuing in the current financial year and is above 3% year to date.