I should have included in the above that David Nelson's salary will impact next year's results. There is also a risk that he decides to change things around incurring more one-off costs.
The facilities management software market is growing rapidly and it is frustrating that we have not seen Urgent take advantage of this to date.
They are growing revenues by 35% per year and I think we will start to see Urgent capturing some of this industry growth in the next few years for the following reasons.
1) Karl Jacoby was running Techniche on a part time basis whilst juggling his other commitments (eg Brisbane Angels Group) but they have now installed a full-time CEO in David Nelson. Furthermore, David has a track record of growing sales in B2B technology companies (whilst he was CEO of Inovia, sales grew 400% in 7 years).
2) Perhaps more significantly, Urgent has just completed development of a brand new product, Emaintenance Plus. The old product was tailored to each customer's requirements which made it very labour intensive to upgrade and support. In effect, Urgent had to maintain numerous different version of the same product. Also because of this inflexibility, it was only really suited to customers in the fuel retail vertical.
The new product on the other hand is module based incorporating all the features of the different versions of the old product plus some new features in one standard offering. It can be upgraded and maintained centrally with all versions updated automatically. It is also suitable for for non-fuel retailers. This means that Urgent can switch from a business that generates significant revenues from labour intensive development work for a few large customers to one that is focused on winning new sales and growing recurring revenue streams.
TCN Price at posting:
7.9¢ Sentiment: Buy Disclosure: Held
