Spectur reports best first quarter performance on record

Australian solar-powered smart security provider Spectur (ASX: SP3) has set new revenue and subscription records for the first quarter of the new financial year.

The company has reported it best first quarter performance on record, earning revenues of more than $1.44 million and representing an increase of 37% year-on-year.

The numbers gained momentum towards the end of the quarter, generating a September monthly total of $597,000.

It marks the third largest month of revenue in Spectur’s history and represents an increase of 61% compared to September last year.

With the second and fourth quarters generally being the strongest seasonal periods for the company, Spectur said record first quarter results demonstrate “ongoing fundamental growth” in its operations.

They were achieved against a backdrop of extensive COVID-19 lockdowns across New South Wales and Victoria, which represent substantial markets for the company.

Quarterly expenditure

The first quarter of the financial year is a seasonally-slower period for Spectur’s revenues and coincides with a number of annual and one-off cash expenditures.

Accordingly, expenditure from net operating activities in the first quarter increased to $2.4 million – up from $1.7 million in the previous corresponding period.

Key elements of the increase were staff costs of $109,000 including annual payroll tax and workers compensation premiums plus an additional pay run of $86,000; administration costs of $180,000 including business insurance premiums and fees relating to the ASX, auditing and tax consulting; and product manufacturing and operating costs of $140,000 including investment in additional inventory to ensure that Spectur can continue to meet expected customer demand.

The company’s underlying business expenditure stayed materially the same during the period.

Sales pipeline

Spectur’s unweighted pipeline of sales opportunities sat at $6.3 million by the end of the quarter, with a probability-weighted pipeline of $2.68 million representing quarter-on-quarter growth of 36% and 48%, respectively.

This pipeline includes larger contracts related to the expansion of existing accounts in the utilities and construction sectors as well as the addition of new customers in the industrial, government, not-for-profit and utilities industries.

The company expects sales demand to increase as lockdown restrictions continue to ease, summer holidays approach and business conditions improve.

Coinciding with the return to warmer weather, deployment of Spectur’s safety and warning platforms on beaches is expected to further expand longer-term opportunities in the safety and warning applications space.

Record performance

Spectur managing director Gerard Dyson said he was pleased with the company’s record performance during the first quarter of 2022.

“The start of the quarter coincided with some of the most extensive and severe lockdowns in the recent history of Australian pandemic management but despite the dampening impact of these interventions, we were still able to [experience] record quarterly revenues,” he said.

“As lockdown-related headwinds dissipate and a traditionally-strong seasonal period approaches, we anticipate improved ongoing performance… we have a very healthy pipeline, we are equipped with a bolstered inventory of componentry to meet demand and we have a stable team delivering now and into the future.”