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Crowd Mobile Announces Record Results for March Quarter

Crowd Mobile Announces Record Results for March Quarter
The mobile application services company reported a significant improvement in its operations during the three months ended 31st March 2016.
Apr 13, 2016 By Kaivalya Kandarpa Tags: CM8

Crowd Mobile Limited (ASX:CM8) announced a record earnings result for the March quarter as it generated revenue and EBITDA growth of 242% and 515% respectively.

The mobile application services company reported a significant improvement in its operations during the three months ended 31st March 2016. Group revenue increased 242% over the same period last year to $11.5 million. The company attributes the positive result to a 59% increase in its total billed messages to 2.3 million, marking its ninth consecutive quarter of gains. Crowd mobile also continues to generate free cash flow on a month-to-month basis.

The company anticipates this trend to be sustained over the medium term, supported by organic growth and the previously announced agreements regarding the launch of its m-payment networks into new countries.

The CEO of Crowd Mobile, Mr. Domenic Carosa commented on the results: “We are pleased with the performance of the Q&A division and we are now focusing on driving greater efficiencies and innovation across the group to ensure we are well placed to achieve the next phase of growth and also leveraging synergies between our Q&A and subscription business.”

The Track acquisition, which forms Crowd’s Subscription division, has contributed Revenue and EBITDA that were at the lower end of the original forecasts as Crowd increases its investment to build a more sustainable business.

Mr. Carosa added that the company aims to prioritise “margin improvement and product innovation over near-term revenue growth for the Subscription division to enable us to build a stronger platform to maximise longer-term growth for this business unit.”

Crowd Mobile has also made an initial payment of €2 million in January 2016, for the Track Vendor earn-out, using its existing cash flow and is set to pay the final instalment of €2.5 million in June 2016 from organic cash flow.

Despite the positive announcement, CM8 has declined 2.3% and was last traded at 21.5 cents as at 11:35 am (AEDT).

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Kaivalya Kandarpa Author: Kaivalya Kandarpa Apr 13, 2016

Kaivalya is an equity analyst and a client advisor at Wise-owl. She specialises in fundamental and technical analysis for large and mid-cap companies. Having completed her bachelor's degree in Business Administration majoring in Finance, Kaivalya has a comprehensive understanding of international stock market movements. She tracks local and overseas markets and compiles analytical reports for various industries.

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