Online screening and verification company CV Check (ASX: CV1) has delivered its second consecutive cash positive quarter, reporting a huge boost in operating and investing cash flow driven by solid order growth from its business customers.
The company today announced a combined operating and investing cash flow of $233,000 for the March 2019 quarter, representing a more than 150% increase on the same period last year and the second cash positive quarter in a row.
Cash receipts for the quarter totalled $3.1 million, up 17% on the March 2018 quarter, with $2.1 million being derived from its business customers.
According to CV Check, this cash balance is expected to provide “sufficient financial flexibility to pursue promising organic growth opportunities in Australia and internationally”.
Growth in business customers
CV Check operates an online platform for businesses and individuals to conduct background checks on potential employees, such as verifying employment and qualifications. It also performs police, traffic and financial checks and even offers predictive psychometric assessments.
Its wide range of clients include telco leader Optus, major resource and energy companies Chevron, Inpex and Alinta Energy, entertainment networks Warner Bros, Channel Nine and Seven, South Australia’s water corporation, recruitment agencies, education institutions and casino and nightlife business Crown Perth.
During the March quarter, CV Check’s focus was on establishing a customer engagement hub in Melbourne to better serve its business customers in the eastern states.
According to the company, business development resources are currently being bolstered and additional recruitment is underway.
CV Check also recently integrated its technology with SAP SuccessFactors, a major human resource cloud management system with more than 13,000 corporate clients. Since then, two major enterprise client integrations have been tested successfully.
During the quarter, the company also redirected its advertising spend into its business customer segment, focusing on higher margin non-criminal history products.
“The over 150% improvement on the same quarter last year is directly attributable to the efforts of our team for delivering solid growth in B2B segments, maintaining our market presence in B2C markets and managing our cost base effectively,” CV Check chief executive officer Rod Sherwood said.
“Investment in corporate client engagement is leading to insights that are driving technology builds providing further leverage for CV1 to capture a greater share of the B2B online screening and verification market – there is tremendous scope for organic growth here,” he added.
Mr Sherwood said the board and executive team was now “exploring strategic options to further accelerate growth” by leveraging its technology and market position.
By mid-afternoon trade, CV Check shares were up 5% to $0.105.