- Enterprise software company 8common (8CO) went cashflow-positive over the first quarter of the 2021 financial year — its second positive quarter in a row
- Total quarterly revenue came in at $940,000, which is five per cent higher than the same time last year
- With some prudent cost-saving measures in light of the COVID-19 pandemic, 8common was able to go cashflow positive by $52,000
- One of the highlights from the quarter is the three-year deal with EML Payments (EML) to create the CardHero and CardHero+ products
- These are virtual and physical cards designed to help organisations manage expenses
- Nevertheless, despite the largely positive report, shares in 8common closed almost four per cent lower and worth 12.5 cents each
8common (8CO) went cashflow-positive over the first quarter of the 2021 financial year — its second positive quarter in a row.
The company said in its latest quarterly financial report total revenue came in at $940,000 for the quarter, which is five per cent higher than this time last year.
At the same time, some prudent cost-saving measures in light of the COVID-19 pandemic saw quarterly staff and corporate costs come in at $925,000 — over 26 per cent lower than the June quarter’s $1.26 million.
The result was net cash inflow of $52,000, which is slightly up on last quarter’s $46,000. At the end of September, 8common had $1.9 million worth of cash in the bank.
8common CEO Andrew Bond said on top of the positive operating cash flow, the company grew its topline and recurring software as a service (SaaS) and transaction revenue.
“The signing of six new Federal Government entities, five of which are part of the Service Delivery Office (Shared Service) of the Department of Finance, shows the continued and growing acceptance of our Expense8 product amongst Government agencies,” Andrew said.
Expense8 is a travel and expense management software, designed to help users plan, book, and keep track of corporate trips. The software even helps companies put together tailored business intelligence reports.
“We continue to partner with government and execute on the shared services program and we continue to see a strong pipeline of growth for FY21,” he said.
8common’s quarterly recurring SaaS and transaction-based revenue came in at $551,000 for the quarter, which is one per cent higher than the June quarter.
The EML deal
Of course, a major highlight from EML’s September quarter came from a three-year deal with fellow ASX-listed EML Payments (EML) to create a reloadable card program called CardHero.
The product is designed to be a card payment and expense management solution, targeting two clear gaps in the market: integrated corporate payments and fund disbursement and transaction reconciliation.
CardHero will be both a physical and virtual card targeted at government entities and large enterprise clients. A CardHero+ product will also be developed for not-for-profit organisations and educational institutions.
“The agreement with EML for prepaid Mastercards provides a significant step forward for our CardHero and CardHero+ platforms,” Andrew said.
“The demand for corporate virtual and physical card payments are expected to continue to rise in tandem with consumer payments,” he said.
“With a strong balance sheet, positive cash generation, growing Expense8 demand and the development of the CardHero platform, the company has a strong outlook for FY21.”
Nevertheless, it seems investors weren’t convinced. Despite the largely positive report, shares in 8common closed 3.85 per cent lower and worth 12.5 cents each.