Vonex benefits from multiple growth drivers
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Telecommunications services provider Vonex Ltd (ASX:VN8) provided a trading update on Tuesday which featured outstanding growth in retail clients, resulting in its shares hitting a high of 17 cents, representing an increase of nearly 40% compared with Monday’s closing price of 12.5 cents.
This built on previous share price momentum, and the company has now undergone a sharp rerating relative to last Friday’s closing price of 10 cents.
Vonex is a full service telecommunications service provider selling mobile, internet, traditional fixed lines, and hosted PBX and VoIP services, predominately to the small to medium enterprise (SME) customers under the Vonex brand.
Vonex has continued to deliver strong growth in its retail business, exceeding 28,000 registered Private Branch Exchange (PBX) users as at April 30, 2019.
Channel partners to provide sustained growth
The company’s targeted nationwide marketing program and constructive engagement with its network of channel partners are driving consistent growth in Vonex’s active user base.
PBX registrations are a key indicator of business development progress as Vonex penetrates the multibillion-dollar Australian market for telco services to small and medium enterprises SMEs.
These factors have also driven a sustained uptick in new customer orders in 2019, with Vonex delivering March quarterly year-on-year new customer order value growth of 20%.
Revenues from these orders will be realised in subsequent quarters, highlighting the company’s significant and sustained growth profile, and arguably sustaining strong share price momentum.
Vonex expects to continue to grow its PBX user base as the company accelerates its targeted marketing to SME customers.
Beneficiary of NBN rollout
Vonex will target the NBN rollout in Australia’s capital cities as its campaign develops, delivering sustained website traffic growth and result in new customer leads online and through channel partners across the country.
A key driver of Vonex’s rapid and consistent growth in PBX users is sales through channel partners, a network of hundreds of qualified sales partners with which Vonex collaborates.
In the financial year to date, Vonex has recruited an additional 63 new Channel Partners, putting the company on track to add 100 new partners by the end of fiscal 2019.
Vonex also develops new technologies in the telecommunications industry, including a feature-rich cloud-hosted PBX system.
This PBX system offers SME clients a range of benefits compared to on-premise PBX systems, including lower cost, high scalability and much higher reliability.
The newly updated software provides a more user-friendly interface, automation for a wider range of hardware vendors, stronger security and seamless integration with customer relationship management systems.
Vonex is also developing the Oper8tor App, a multi-platform real-time voice, messaging and social media app that allows users to connect with all social media friends, followers and contacts across different social media, all consolidated into one app.
New products to drive exponential revenue growth
Revenue from sales of these new products will provide additional revenues in the near to medium-term, elevating the company to one of the most prominent growth stories in the telecommunications sector.
Commenting on the company’s impressive growth trajectory, managing director Matt Fahey said, “This is a pivotal period for Vonex as we ramp up our marketing efforts to drive PBX user and channel partner growth.
“We anticipate this will continue to translate into meaningful revenue growth as we execute on our strategy and strengthen our position in the market for telco software and services.
“We are ideally positioned and well-resourced to build on our recent momentum and are poised to meet our target of recruiting 100 Channel Partners in FY19 to empower Vonex to rapidly gain scale.”
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