Nexion’s solid project-based and recurring revenues for the quarter mean that it is hitting key milestones since the IPO.
Hybrid cloud provider Nexion Group (ASX:NNG) has just announced a solid first quarter since its highly successful IPO in February, with total revenues increasing by 38 per cent.
The company’s non-recurring project revenue was a standout, increasing by 170 per cent to $0.38 million, as activity returns to pre-COVID levels with new projects coming on-stream in March.
Annualised recurring revenue has also increased by 12 per cent on pcp to $2.24 million, as new customers began to come online following a strong sales start for the calendar year.
The company expects that a strong growth in new projects will flow through and add to its recurring revenue in the next few quarters as these new customers are on-boarded to the Nexion OneCloud platform.
Total contract value of recurring revenue being billed has now exceeded $6 million, and the company says this will continue to grow as new long term contracts are coming on-steam in Q3 and Q4.
A busy and productive quarter
During the quarter, Nexion has focussed on the delivery of its key milestones since the IPO.
This includes contracts with IBM, architect Hames Sharley and the “phenomenal one of a kind agreement” with Aryaka.
The deal with cloud SD-WAN provider Aryaka was actually signed in November, which allowed Nexion to offer points of presence (PoP) and nodes in locations around ANZ and the globe.
During the quarter, the company completed its first Aryaka node in Perth, with new SD-WAN sales revenue due to be booked in Q4. The second Aryaka node is about to be deployed in Auckland, which is to begin in Q4 for go-live early in Q1 FY22.
Earlier this month, Nexion also made headway toward its expansion strategy, announcing the acquisition of Blue Sky Telecom (BST), a Perth-based telecommunications and network solution provider.
Founded in 2013, BST is a $2.9 million-revenue company which is growing rapidly. Nexion said the acquisition will combine both companies’ products and infrastructure, to create a synergised, full-service offering.
That agreement was followed by a three-year deal with national design firm Hames Sharley in April.
Nexion also signed a crucial five-year multi-million dollar contract with IBM in February to deploy its solutions that includes the OneCloud Hybrid Cloud. It was the second contract with IBM in the last 12 months, and would generate $4 million over the five-year period for the company.
Nexion co-founder and CEO, Paul Glass, was pleased with the developments in the last quarter.
“The quarterly results are an example of the company executive drive for increased long term contracted revenue,” he said.
“Nexion is an amazing company to have co-founded and to lead into the future. I am a very motivated and enthusiastic leader and Nexion as a whole allows me to embrace this,” Glass said.