AD1 Holdings (ASX: AD1) has posted a “strong and productive” March quarter underpinned by new customer and project wins.
Most notable was a multi-year $10 million deal secured in February with energy retailer Locality Planning Energy by the company’s utilities software division, which is set to increase its recurring software as a service and managed services revenue by 50% for the year.
AD1 chief executive officer Prashant Chandra said the landmark contract would be a fitting end to the 2021 financial year.
“This positions the company well to exit this year with an annual recurring revenue in excess of $6 million, [which is] a significant increase from the prior year,” he said.
“It is also a great validation of the value our utilities technology solutions can deliver for customers.”
The company’s newest addition SaaS business Art of Mentoring (which it announced it was acquiring in September last year – continued to perform well in the three months to 31 March, providing AD1 with a “good balance of shorter sales cycle opportunities”.
The business brought in six new clients during the March period to total 21 new clients since the start of the financial year.
New sign-ups include Anglo American Metallurgical Coal Pty Ltd, AusIMM, NSW Public Service Commission and St John of God Health Care.
“The sales pipeline across the company is stronger than ever and progressing well,” Mr Chandra said.
AD1 recorded cash receipts of $1.53 million for the quarter, representing an increase of 80% compared to the previous corresponding period.
Net operating outflows of $400,000 covered the funding of major projects and new customer implementations.
“Meters under management” for the utilities software division grew by approximately 4,500, representing a quarter-on-quarter meter increase of 10%.
AD1 has also entered into $2 million of debtor, trade and term loan facilities with Australian fintech Moneytech Finance Pty Ltd to fund the delivery of sizeable projects and new customer wins from March.
Mr Chandra said the agreement would see the company through the next six months of progress.
“Our key focus will be to ensure we execute the exciting delivery pipeline built over the March quarter, funded by our binding agreement with Moneytech,” he said.
“We will make prudential operational investments over this period to create the necessary bandwidth to ensure seamless solutions delivery for our customers.”