Telecommunications innovator Vonex (ASX: VN8) reported record unaudited gross revenue for the three months ending June of $10.5 million, representing an 81% year-over-year increase on the other.
The company’s annualized recurring revenue also rose more than 97% year-over-year to approximately $36.2 million.
Following record revenue in the prior quarter, Vonex added $2.37 million total contract value (TCV) in new customer sales for the reporting period, representing 47% year-over-year growth and marking three successive quarters of over $2 million TCV.
Vonex has now attracted more than 100,000 registered active users to its cloud-based private branch exchange (PBX) telephone service, which it considers a key indicator of its progress in business development.
The company’s wholesale division also saw steady growth in the quarter, with NBN’s revenue with 4G backup growing 22% year-on-year, while its flagship Voice over IP product saw a 37% increase in sales. revenues, reflecting a strong cross-selling strategy.
Growth strategy
Vonex remains focused on targeting business acquisitions that offer potential for growth in revenue, earnings, product diversity and entry into new markets.
In January the company purchased South Australian voice and internet services company Voiteck and by the end of June Voitek’s customers had been migrated to the Vonex network.
Vonex also continued to provide a phased migration of MNF Group customers to its network and PBX platform following the acquisition of MNF’s Direct Business in mid-2021.
The company sells voice, internet and mobile cloud services to small and medium-sized businesses and residential customers in Australia.
After the migration is complete, Vonex expects a net savings in personnel costs of between $600,000 and $700,000 per year.
Telco partnership
In June, Vonex partnered with local telecommunications company More to become the exclusive provider of a new IP telephony and hosted PBX enabling platform for Commonwealth Bank (ASX: CBA) customers.
Under the agreement, Vonex will charge More a one-time fee for the initial development of the custom platform, estimated at $70,000 based on a daily development rate.
Melbourne-based More is part-owned by Commonwealth Bank, which last year announced a strategic partnership that offers special benefits to bank customers.
Money at your fingertips
At the end of June, Vonex had about $3.2 million in cash and $14.5 million from a funding facility with Longreach Credit Investors.
Net operating cash inflow for the quarter was $1.3 million on receipts of $9.5 million.
Monthly cash flow is expected to improve by $833,000 following a final deferred payment in August for the acquisition of MNF Direct Business.
Payments to related parties for the quarter included $159,215 in directors’ fees and salaries and $13,500 in administration and accounting costs.
