Descartes (TSX:DSG) CEO Art Mesher arrived at the morning session of the M Partners Tech12 Conference in Toronto today to deliver what he said was a new presentation aimed at US shareholders.
Mesher said he is unsatisfied with valuation multiples granted his company north of the border, and intends to take advantage of the company’s US listing. Descartes spearheaded the initiative about fourteen months ago, he said, and the company has already added Fidelity and Vanguard as shareholders.
Mesher told conference attendees that everything the company has accomplished of late in the result of a plan they are working from that was published eight years ago. This plan, says Mesher, leverages Moore’s Law and Metcalfe’s Law to guide an organization whose costs decrease each year and benefits from a network effect of increasing scale.
Profit is clear focus for Descartes, and Mesher says he gets frustrated with those who only focus on the topline. This means Descarte’s stellar profitability is often overlooked. Mesher points out that, per dollar of revenue, Descartes is the most profitable software-as-a service company in the world. The company’s recently reported quarter was its 32nd consecutive of beating the street’s expectations.
Descartes is doing well in part because of positioning. Logistics, says Mesher, is the “backbone” of commerce. He says the company lives at the convergence of three markets; supply chain execution, mobile resource management, and global trade compliance. Ultimately, says Mesher, Descartes makes previously incongruous systems talk to each other.