Recruitment platform provider AD1 Holdings (ASX: AD1) is another technology junior to continue growing despite the COVID landscape, with the company achieving an almost 40% increase in its quarterly cash receipts, while slashing operating costs.
AD1 revealed cash receipts of $864,000 for the September quarter 2020, which was a 37% increase on the same period in 2019.
This figure is even higher when delayed receipts of $245,000 are included – boosting the figure 45% to more than $1.1 million.
A $400,000 research and development credit was also received during the quarter.
Adding to the positive picture was a 42% decrease in operating expenses which shrunk to $1.1 million. This fall was compared to the previous corresponding period.
Powerclub and 3P Energy contracts to grow revenue further
“They add materially to the company’s revenue once implementation commences and also have the potential of significant growth over the term of the contract as the number of meter managed via our platform continues to increase.”
“Powerclub has been implemented and is revenue generating with 3P Energy expected to commence implementation later this quarter,” Mr Chandra added.
Also during the September quarter, AD1 extended a managed services agreement with the Victorian government, which will bring in revenue for another three years.
Diversifying with Art of Mentoring acquisition
AD1 revealed a the end of the September quarter it was acquiring Art of Mentoring, which it describes as a “leading” mentoring software as a service platform provider.
The rationale behind the acquisition was to create a more diversified recurring revenue stream.
Mr Chandra described the acquisition as a “compelling strategic fit” for AD1, with “great synergy” for customer opportunities and technology.
Art of Mentoring is currently being integrated into AD1.
To fund the acquisition, AD1 raised $2.5 million in an oversubscribed placement in October.
Art of Mentoring’s current annual recurring revenue stream totals about $ million, with AD1 expecting strong growth prospects across the combined entity once integration is complete.