Home News NEXION reports extremely strong start to FY22

NEXION reports extremely strong start to FY22

by jcp
NEXION Group Ltd (ASX: NNG), the fast emerging, global provider of end-to-end enterprise ICT Managed Services, Hybrid Cloud and SD-WAN solutions is pleased to announce a strong September Quarter with revenue up 130% to $1.25M (unaudited) compared to Q4 FY21. Including the pro-forma contribution from Blue Sky Telecom prior to acquisition, revenue is up 252% to $1.91M (unaudited), the highest revenue reported in the history of the company. Going forward, the company now has a new baseline of $7.64M annualised exit run-rate and with continued growth of just 25% quarter-on-quarter is set on a trajectory toward its FY22 Prospectus target of $15M revenue.

Highlights

  • Quarterly revenue up 252% to $1.91M including acquisition revenue prior to completion on September 1st.
  • Annualized Recurring Revenue (ARR) up 145% to $5.9M.
  • Total Contract Value (TCV) up 38% on top of Q4 FY21’s exceptional 68% increase to $14.15M.
  • Acquisition of Blue-Sky Telecom (BST) completed with $900k of efficiencies realised.
  • Executive team enhanced to include Chief Revenue Officer, Chief Financial Officer and Chief Technology Officer in preparation for further expansion.
  • Strategic partnership formed with Spectrum Consulting Limited a to deliver the full suite of NEXION solutions throughout New Zealand.

Commentary

NEXION has made a step-change in revenue generation both organically and with the addition of its first acquisition since IPO. With the Blue Sky business consolidated into the Group, NEXION’s sales and delivery capacity has doubled, setting the foundation for accelerated growth in the coming months.

The Blue Sky acquisition for $2M cash was completed late in the quarter and $900K of annual cash costs were extracted after consolidation into NEXION Group. These efficiencies plus the addition of two new high-margin recurring revenue streams (satellite and voice) brings NEXION Group closer to EBITDA positive later in the financial year.

NEXION Group previously annoucned key appointments to its executive management team in preparation for its next phase of growth. Evelyn Hogg, FCA, MAICD, took on the Group CFO role. Jamie Morgan has joined the company from IBM as Chief Revenue Officer responsible for national and global sales and Luke Poyner has been promoted internally to Chief Technical Officer. The enhanced executive team allows Paul Glass to focus attention on acquisitions and global expansion knowing that the core business is being managed well by a group of highly skilled individuals.

To build on the New Zealand business that was established in the last half of FY21, NEXION formed a strategic relationship with (circa. $8M revenue) Spectrum Consulting Limited (Spectrum) in Auckland which will see it deliver the full suite of NEXION solutions. Founded in 2001, Spectrum’s has a long history delivering mission-critical Cloud, Networks & Security, and Data Management services for enterprise clients across most industries. The relationship with Spectrum provides NEXION with access to local resources that can deliver services to NEXION’s customers in the Pacific region.

Other highlights for the quarter included an agreement (previously announced) with Global data storage vendor NetApp® to deliver the region’s first Keystone storage-as-a-service offering across Australia and New Zealand and further geographic expansion with Aryaka.

As enterprise shifts to consumption of technology as a service, the demand for NEXION’s Hybrid Cloud solutions continues to grow. NEXION is fast becoming a contender in the enterprise IT Managed Services market, having established a strong position with key partners IBM, Aryaka and now NetApp.  Enterprise customers continue to select NEXION to provide all aspects of technology-as-a-service, including networks, helpdesk, storage, cloud, compute, security, wireless, professional services, satellite, and voice.

About NEXION Group Ltd

NEXION is an information technology service provider that offers compute and data storage equipment as a service that it integrates with Public Cloud services to form a Hybrid Cloud. The Company offers private Cloud infrastructure integrated with Public Cloud services to form the NEXION Hybrid Cloud solution it calls OneCloud. NEXION hosts a OneCloud Node in its own data centre in Perth and third-party data centers in other cities and sells capacity to customers on term contracts up to 60-months. NEXION provides project management services to migrate customers to its Hybrid Cloud platform as well as associated equipment and support services for additional fees. The Company also provides local and global SD-WAN to connect customer premises and equipment to its Hybrid Cloud.

www.nexiongroup.io

A summary of expenditure since listing, and a comparison with the use of funds statement in the Company’s prospectus dated 30 November 2020, is set out below:

Payments to Related Parties in Appendix 4C

The ASX Appendix 4C announced by the Company on 20 October 2021 included payments to related parties in item 6.1. These payments relate to directors’ fees for that quarter.

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