AD1 Holdings secures significant contract wins and accelerates growth in North America
AD1 Holdings (ASX: AD1) has reported an 11% year-on-year increase in revenue, with more growth anticipated as its Art of Mentoring (AoM) subsidiary expands into North America.
Cash receipts were down 25% from the prior corresponding period in FY2022 as a result of lagging customer payments.
The technology company, which boasts a growing portfolio of market-leading software businesses, said that if overdue debtors were collected cash receipts for quarter would have been up 16% on year-on-year.
AD1 chief executive officer Brendan Kavenagh said the company’s cash receipts don’t reflect its performance to start the financial year – adding the majority of outstanding payments will be received and included in the cash receipts for the December quarter.
“The quarterly cash receipts do not accurately reflect the momentum we are witnessing in the business due to various delays in payments from select customers and the issuance of invoices falling at the end of the quarter,” he said.
The company closed out the quarter having secured a number of significant contract wins, which further accelerated its growth in Australia and North America.
“There are positive signals as we enter FY2023 with significant contract wins and ongoing momentum for ApplyDirect and AoM,” Mr Kavenagh said.
“We are very excited to have signed an agreement with a significant US Tech giant such as Intel so soon after landing in the US.”
North American market expansion
AD1’s subsidiary AoM enjoyed a strong performance in the September quarter, as it secured the division’s first North American contract win with Intel, which boasts a potential loan-to-value (LTV) of around $150,000.
The division also secured contracts with popular Australian customers, the Australian Diabetes Educators Association (ADEA) and an Australian government body with a combined potential LTV of around $395,000.
AoM increased its marketing activity in the quarter, and as a result is poised to carry out its strong US sales pipeline moving forward, capitalising on North American market opportunities that present and up-selling opportunities from existing customers across the group.
AoM chief executive officer and co-founder Alex Richardson was relocated to Austin, Texas in August to accelerate the growth of AoM in North American.
“It is pleasing to observe such strong interest and pipeline that is growing very quickly a month into relocating Richardson to Austin, Texas in early August,” Mr Kavenagh added.
AD1’s ApplyDirect technology division posted a strong performance to start the financial year, having reported revenue growth of 50% on year-on-year increase and a contract win with one of the largest GDP contributing industries in Victoria over an initial two-year period.
The contract is valued at $243,000 and also includes an option to extend for an additional year.
AD1 said securing the contract “reinforces AD1’s position as a leading provider of recruitment technology”.
ApplyDirect’s end-to-end recruitment technology will provide a worker portal for the Victorian based customer where workers can easily uncover further career opportunities, as AD1 is also contracted to build, host and provide ongoing maintenance and digital services.
Jobtale and USS
In Q1, AD1 successfully launched Jobtale, its small-to-medium enterprise recruitment platform, which has already signed 79 customers and been shortlisted as a finalist for the Australian Talent Conference.
Jobtale was chosen as a finalist in the ATC & HR Tech Fest Innovation Labs among more than 1,500 attendees within Talent Acquisition & Human Resources.
AD1 also enjoyed steady organic growth in its Utility Software Services (USS) division with revenue increasing 13% year-on-year.
AD1 has planned FY2023 as a year for growth and the company remains optimistic on achieving the milestones that have been set across each of its divisions.
In August 2022 AD1 announced the acquisition of talent acquisition and management software provider, Scout Talent Group, which will be finalised in December 2022.
Mr Kavenagh said the company looks forward to its continued expansion efforts, across all divisions moving forward.
“We continue to be focused on growing all verticals of the business and are very excited about the developing opportunities in Australia and North America,” he said.