Technology company Connexion Telematics Ltd's (ASX: CXZ) share price leapt 42% in morning trade today following the release of the company's full year results for the year ended 30 June. At the time of writing, the Connexion share price was trading at 2.7 cents, up from yesterday's closing price of 1.9 cents.
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Why is the Connexion Telematics share price on the move?
The Connexion share price surged after the company reported total revenue of $8.2 million. That was up 131% from the $3.6 million total revenue reported in FY19.
Net profit after tax (NPAT) also gained strongly, up 587% from the previous financial year to $3.2 million.
Net cash flow grew by 254% to $1.49 million while diluted earnings per share (EPS) leapt 537%. Working capital increased 256% year on year, to $3.35 million.
The company's tech and support team also expanded by 33%.
Connexion announced that its growth initiatives will be pursed in the 2021 financial year.
What does Connexion do?
Connexion Telematics is an Internet of Things (IoT) technology company working to revolutionise smart car technology. It has commercial agreements with lead players in the automotive industry for its proprietary smart car technologies.
Connexion plans to roll out its products into millions of vehicles over the coming years. It has developed two flagship Software as a Service (SaaS) products, including CXZ Telematics, a cloud-based, integrated vehicle management system. This simultaneously tracks – in real time – all key performance indicators of a vehicle.
The company's OnTRAC CTP/CTA subscription base averaged 69,000 vehicles for the 2020 financial year.
What did Connexion say?
The company reported it managed to build on positive momentum achieved in 2019 to deliver strong results, despite all the uncertainty throw up by the COVID-19 pandemic.
It continued to provide its SaaS offering, OnTRAC, to General Motors, Courtesy Transportation, and Cadillac's Courtesy Transportation Alternative. The company noted it's the only SaaS courtesy transportation solution software used by General Motors, and that barriers to entry are considerable.
Looking ahead, the company plans to continue building on its OnTRAC CTP/CTA SaaS solution with the General Motors dealership network. Optimisation and customisation work are ongoing, which Connexion says will continue to drive increased net revenue in the year ahead.
Outside the General Motors dealership network, the company is pursuing other growth opportunities through external applications with other OEM vehicle dealerships as well as independent software suppliers in Australia and the United States.
