Perth-based CVCheck is charging into the black after continued strong revenue growth in April and May. The innovative provider of online police checks, employment screening and a burgeoning range of related products also has more growth in the pipeline, thanks in part to changes to 457 visas in Australia and new requirements by NZ’s Health Department.
CVCheck’s extraordinary revenue growth has continued through April and May, keeping the ASX listed tech play on track to turn cash flow positive in the final quarter of calendar year 2017.
The Perth-based company has carved out a leadership position in a rapidly expanding industry that began with employer demand for background checks relating to job seekers that were being less than truthful when submitting their CV.
CVCheck’s business has grown into a well patronized online platform with the capability to conduct a plethora of different checks across 190 countries.
Last month, the company reported record monthly results for February and March, which boosted Quarter 3 FY17 revenues by 38% to $2.73 million.
In an update to the ASX this week, CVCheck reported that revenues in April had met original expectations, despite some earlier concerns that order flow would be affected by a large number of holidays. Solid order flow has continued into May across Australia and New Zealand.
The strong trading results led management to reaffirm their expectation to be cash flow positive in the last quarter of calendar year 2017, just two years after the company listed on the ASX.
The pace of improvement in CVCheck’s financials is highlighted by the sharp reduction in operating cash burn to just $0.4 million in quarter 3 of FY17, 63% less than the second quarter of FY17.
The charge towards positive cashflow reflects a combination of strong revenue growth and aggressive cost cutting by newly minted CEO, Rod Sherwood, who held the CFO role since 2011.
This week’s update contained plenty of indications of much more revenue growth in the pipeline.
According to the company, CVCheck recently won significant new business In New Zealand in the Government and retail sectors. Orders for the company’s Child Work Safety Check have also increased as many organisations adopt new practices legislated by NZ’s Ministry of Health.
In Australia, changes to 457 visas announced last month are also expected to be positive for the company. CVCheck’s visa/work entitlement check has recently been completely automated and can now be bundled with other services.
The company is also trialing a new predictive analytics product with more than 20 corporate clients. The product allows employers to conduct psychometric tests for about 50 different roles, ranging from the CEO position to sales rep and provides instant feedback on a candidate’s suitability.