- Enterprise software company 8common (8CO) has seen its share price slip today despite revealing a cashflow-positive final quarter of the 2020 financial year
- The company's total quarterly revenue was down 11 per cent compared to the same time last year, coming in at $923,000
- Yet, while recurring revenue was down on the March quarter, it was five per cent higher this year compared the 2019 June quarter
- Moreover, full-year revenue is eight per cent up on the 2019 financial year, with 8common going cashflow-positive by $46,000 in the June quarter
- Still, on a tough day for the tech sector, it seems investors were expecting more from the company
- 8common shares lost over 11 per cent today, closing at seven cents each
Enterprise software company 8common (8CO) has seen its share price slip today despite revealing a cashflow-positive final quarter of the 2020 financial year.
In a day brutal day for tech stocks, it seems 8common would have needed to report something special to impress investors. Instead, the company revealed that total revenue declined by 11 per cent over the June quarter compared to the same time last year, coming in at $923,000.
However, recurring software-as-a-service (SaaS) and transaction-based revenue was up five per cent on the same period last year, although it was down 17 per cent against the March 2020 quarter. 8common blamed slowed economic conditions from the COVID-19 pandemic for the decline.
Still, 8common's June quarter was cashflow positive by $46,000, with $1.8 million in the bank heading into the new financial year.
8common CEO Andrew Bond said the quarterly result was a reflection of a challenging economic environment, but things are already starting to look better.
"Since the low point in April 2020, we have seen a steady recovery of SaaS revenue in May and June," Andrew said.
"New customer implementations continued over the period albeit at a slower pace. Business activity has picked up in the early weeks of FY21 and we expect to onboard a number of the more than 50 Federal Government entities that are part of the shared services mandate to our platforms over the next twelve months," he added.
Moreover, Andrew said the company expects the 2021 financial year to be the year its CardHERO and PayHERO fund distribution and payment platforms start to deliver some "meaningful contributions" to 8common's financial performance.
For the full financial year, 8common said it pulled in $3.7 million in total revenue over 2020, which is eight per cent higher than 2019. On top of this, total SaaS revenue for the 2020 financial year was $2.5 million — 30 per cent up on the year before.
A catalyst for the revenue bump, 8common said, is its significant exposure to government agencies, which account for roughly 70 per cent of contracted revenue.
Nevertheless, the company's share price declined by 11.39 per cent today, closing at seven cents per share. 8common has a $12.8 million market cap.