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NEXION Group: A tech play turning a profit – now that’s unusual!

NEXION Group Executive Chairman Peter Christie on 6PR Bulls N' Bears Report

Listen to ASX-listed NEXION Group Executive Chairman Peter Christie talk to Matt Birney on the Bulls N’ Bears Report about NEXION’s rapid journey through loss-making months to finally turn profitable in July for the first time.


Perth-based NEXION Group is a company that aims to create advanced technology solutions. Its focus is based on the deployment of service nodes in strategic locations globally to support businesses to deliver local private cloud, connected to global locations. After listing on the ASX in 2021, the company has just delivered its maiden profit.


Matt Birney - Welcome to Bulls N' Bears brought to you today by IT company NEXION Group

Matt Birney - ASX code: NNG

Matt Birney - I'm Matt Birney and I'm joined now by the Executive Chairman of NEXION, Peter Christie

Matt Birney - Hi Pete

Peter Christie - Hi Matt

Matt Birney - Okay so Perth-based NEXION Group is an IT company that offers everything from cloud-based hosting and data storage, networking, cyber security, operating systems and backup services, hardware and software.

Matt Birney - Since listing on the ASX in 2021 the company has been on a pathway to profitability and after restructuring its cost base recently and enjoying significant revenue growth, July marked a milestone month for NEXION with its very first ever profit.

Matt Birney - Okay Pete will get into that profit in a minute but firstly, what exactly does NEXION make money from?

Peter Christie - Well Matt, NEXION's foundation asset is the data center that we own in Belmont and from that facility we deliver enterprise I.T services across the full range of the IT stack including networks, compute storage, software. Everything that an enterprise needs to run its I.T

Matt Birney - Okay so tell me about your EBITDA profitability journey over say the last few months and in particular in July, which I believe was your first-ever profitable month

Peter Christie - Yeah we're really excited about it. We took a decision in February to pivot towards profit. The previous two years we've been focused on top-one revenue growth and so the restructuring was carried out through March, April, May and June.

Peter Christie - We were running at a negative $270,000 EBITDA in April, that reduced to $170,000 in May, down to a $78,000 loss in June, July we hit a $83,000 profit for the month.

Matt Birney - Now as best I can tell from your graphs it looks like you were sitting on monthly revenues of about 600k and you've almost touched 800k in July, why the jump?

Peter Christie - We restructured around April to focus on the revenue that was good revenue, good profitable revenue rather than just revenue for revenue's sake and we started from a base in April of around $540,000 and that's grown steadily through $630,00 -$636,000 and then up to $795,000 in July.  That's just organic growth from new customers and additional services to the existing customers.

Matt Birney - Now the market obviously values annual recurring revenues from software as a service companies like yours rather than you know just once off say hardware sales, what is your annual recurring revenue run rate look like now?

Peter Christie - So 95 per cent of what we do is recurring. We really do focus on solid recurring revenue-based contracts across a full range of our products so when you look at our $795,000 of revenue in July the majority of that is recurring revenue

Matt Birney - I note your share price has doubled recently so you must be doing something right.

Matt Birney - Peter Christie from NEXION Group

Matt Birney - Thanks for joining me on Bulls N' Bears and remember we're only here to give you information, not advice, which you should of course seek independently.

Matt Birney - I'm Matt Birney and this is Bulls N' Bears

Outro - For more public company interviews go to the money page on the 6PR, 2GB, 3AW and 4BC websites and click the public companies tab


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