Connexion Telematics (CXZ) has capped off a remarkable FY20 with a 587 per cent in net profit after tax
The tech business also recorded a 131 per cent increase in revenue for the 2020 financial year, to total around $8.2 million
Additionally, Connexion ended the year cash flow positive and with $2.44 million in the bank
The company said the strong results come as it wasn't overly affected by COVID-19, and was able to build on FY19 momentum
Shares in Connexion Telematics have shot up since today's positive results were announced
Currently, CXZ is trading up 38.6 per cent for 2.6 cents each
Smart car technology developer Connexion Telematics (CXZ) has ended the 2020 financial year with a remarkable 587 per cent increase in profit.
The increase comes as the company was largely unaffected by COVID-19, which wreaked havoc on the wider global economy. Financial results
The almost 600 per cent increase in profit is due to Connexion's net profit after tax (NPAT) jumping from $470,000 at the end of FY19, to $3.2 million in FY20.
The company's net profit before tax also recorded a similarily big increase, up 340 per cent to $2.05 million.
Along with profit increase, Connexion's revenue jumped 131 per cent over FY20 from 3.56 million to a total of $8.2 million.
All up, the tech business ended the 12 months to June 30 cash flow positive, for the second year running, with an improved operational balance sheet of around $1.5 million. Of that, it received $230,000 in R&D tax grants.
Connexion also had $2.44 million in the bank at the end of FY20, up from $938,612 at the end of FY19. COVID-19
The company's strong increases in profit and revenue are being attributed to recurring revenue from U.S. car manufacturer General Motors, one of their biggest customers.
In a statement to shareholders, Connexion said "this year built on the positive momentum achieved in the prior year to deliver a strong set of results against a backdrop of economic uncertainty."
That doesn't mean the pandemic didn't affect Connexion's business - which did record a decrease in subscriptions in the June quarter, from 72,000 to 64,000 - it just didn't affect its financial position as its revenue is not directly linked to sales. Outlook
Going forward Connexion said it was focused on diversifying its revenue base, by pursuing more deals within its current GM dealership network, as well as through other vehicle dealerships and independent software suppliers.
But, the company will have to do this under new leadership, with CEO and Managing Director Guy Perkins resigning in June.
Existing Director Aaryn Nania has stepped in as Interim CEO while the tech business searches for a suitable replacement.
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Source: GM Authority
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