Vonex outlines impressive growth opportunities off the back of acquisition success

By Hannah Goldman. Published at Nov 27, 2020, in Technology

Today, telecommunications group Vonex Ltd (ASX:VN8) published its 2020 Annual General Meeting, which highlights their strong operational and financial performance and future growth schemes.

As the company develops, delivers and licences its advanced communication technologies, generation of recurring revenue continues to drive strong growth.

Vonex possesses a three pillar growth strategy of Retail, Wholesale and Acquisition, with the latter encompassing many key drivers and achievements for all pillars and the company as a whole.

At the forefront of Vonex’s achievements of fiscal 2020 is its March acquisition of 2SG Wholesale.

As an established wholesale provider of hardware and connectivity solutions, the acquisition has delivered a new dimension to Vonex’s business, bringing 150+ new wholesale customers and expanding SME (small to medium enterprise) product offerings.

Through 2SG, Vonex has been able to provide fast, secure, business-grade wireless broadband, meeting strong customer demand amid the rise of COVID-19 induced working from home – a trend that is set to continue.

Consumer demand will assist in utilising immediate cross selling opportunities; selling 2SG internet products to Vonex customers and Vonex voice services to 2SG customers.

Vonex will continue to pursue both organic and acquisition-led opportunities to grow its Wholesale business in FY21.

The 2SG acquisition also helps improve margins by providing wholesale services to the retail division of Vonex; supplying customers with an expanded product range of mobile voice products, NBN, mobile broadband and 5G.

Vonex’s annualised recurring revenue has steadily increased since its ASX listing in 2018, with the 2SG acquisition largely contributing to the 89% increase in FY20.

From a shareholder perspective, Vonex has seen an 160% rise in share price since January 2020, currently trading at $0.26 AUD.

The AGM outlined Vonex’s FY21 outlook, which presents enormous opportunities to address unmet needs among SME’s for an optimal telco service in the new ‘work from home’ paradigm.

A proactive approach to ongoing strategic acquisitions will be central to the company’s FY21 growth.

M&A advisors are aiming to find multiple transaction opportunities, specifically searching for profitable private Telco businesses with annual revenue up to ~$10m.

Targeting such revenues affords Vonex some relatively uncontested space in the Telco sector, increasing their chances of becoming the next consolidation success story.

Vonex having successfully integrated 2SG Wholesale positions the company well to execute this strategy and quickly scale.


Where to invest $1,000 right now

When the experts at Next Investors have a stock pick, it may pay to listen.

The Next Investors have been investing in ASX small cap stocks for years, with their best small cap picks yielding returns of 1,200%, 1,120%, 900% and 678%.

They have just revealed their hand-picked, FY2021 stock portfolio of high conviction long-term investments.

Click the link below to see what they are currently investing in.


SEE THE PORTFOLIO

S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.

Conflict of Interest Notice

S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.

Publishers Notice

The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.

Australian ASX Small Cap stocks | Why Finfeed.com is Australia’s leading small cap publication

Founded seven years ago, Finfeed.com is Australia’s leading and longest standing website for investor and finance news, education and expert opinion.

Published by StocksDigital, Finfeed was created to report daily on the comings and goings of ASX listed stocks in the small cap market.

As the first digital publication dedicated specifically to this space, Finfeed soon became the most trusted publication in the market, quickly garnering over two million page views – a number that continues to rise.

Finfeed.com provides its readers with informative articles that tackle the latest in market moving #ASX small cap news, plus exclusive content you won’t find anywhere else. It is aimed at those with an interest in investing, market education, company performance, start-ups and much more.

Finfeed.com is the only media organisation operating under the strength of a Financial Services License and is backed by leading journalists and analysts all with brands of their own.

The website aims to inform, educate and entertain with content that drills down into the heart of financial matters.

Finfeed is a leading source of investor and market information, with everything investors need to know about how to invest written in a way that anyone can understand. 

Over the years, the website has expanded beyond exclusively reporting on small caps, to profile Australia’s leading ASX listed small, mid and large caps as well as some of the country’s most successful CEOs and business leaders to find out what makes them tick.

Every day you will find fresh content covering:

Fast Facts

Over 4,000 articles published

Over 2.3 Million Page Views and counting

Over 10,000 followers on social media

Subscriber list growing by 2% monthly

Thanks for subscribing!

X