CGI growth strategy draws strong results for CV Check (ASX:CV1) in Q3FY22

Highlights

• CV Check has grown from a provider of Australian/New Zealand background screening services to a global provider of Know Your People software.
• In Q3FY22, the company reported a 64% jump in revenue at AU$6.9 million as compared to the pcp.
• March quarter 2022 was CV Check’s 7th consecutive quarter with cashflow positive from operations.
• CV1 continued to grow its client list and deepen relationships with existing clients in Q3FY22.

Online screening and verification service provider CV Check Ltd (ASX:CV1) is marching forward at a swift pace with its three-pronged CGI growth strategy to deliver strong revenue growth in the March quarter of the ongoing fiscal year (Q3 FY22).

In line with its CGI strategy, CV1 has been Consolidating its base, Growing new markets and Innovating successfully in the growing regulatory technology (Reg Tech) space.

On the operational front, CV1 has made remarkable progress in its evolution from being a provider of Australian/New Zealand background screening services to a global provider of Know Your People software.

Also Read: CV Check impresses again with 84% revenue growth in H1FY22

CGI growth strategy strengthens CV1’s revenue base

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CV1 reported a quarterly revenue of AU$6.9 million, registering a growth of 64% compared to the previous comparable period (PCP). Also, SaaS revenue continued to gain traction with AU$0.6 million in revenue generated from CV1’s Real Time Compliance product (Cited).

The year-to-date revenue stands at AU$19.7 million, representing an increase of about 77% on the pcp. At the end of the quarter, the company had AU$12.3 million cash at bank, with zero debt.

Also, it managed continued cashflow positive from operations for seventh consecutive quarter, securing AU$0.9 million in cash from its operating activities in Q3FY22. The company’s gross margin as posted at the end of the March quarter came in at 64%, as compared to 59% at the end of FY21.

CV1 building strong associations to fuel its growth agenda

CV1 signed a three-year binding SaaS agreement with Hireup Pty Ltd for the provision of real-time compliance monitoring, including identity verification. Hireup Pty Ltd is the largest National Disability Insurance Scheme-registered online platform in Australia. It is likely to be worth over AU$350,000 per annum.

During the March quarter, Atlas Iron also extended its contract for Cited by a year, wherein Atlas Iron will enjoy access to real-time compliance monitoring as well.

The company welcomed Geoff Hoffmann as its Global Sales Director. Hoffmann is expected to further strengthen CV1’s overall business model with his years of experience in building and operating international sales teams and delivering high revenue.

Also read: CV Check (ASX:CV1) wins compliance monitoring contract from Hireup

Targets pinned for FY22

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CV1 is on track to release a mobile credential passport in Q4 FY22, with a government-accredited digital identity before the end of the year. Using this passport, employees of a firm will be able to easily display their capabilities, credentials and experience in a simpler manner. It will be supported by a digital identity accredited by the government.

Further, CV1 has formally started the process for Trusted Digital Identity Framework (TDIF) accreditation of its identity process, through the Commonwealth’s Digital Transformation Agency. This accreditation is likely to be accomplished in 2022 itself.

Do read: CV Check (ASX:CV1) reports a robust December quarter with 83% spike in revenue

CV1’s CEO Michael Ivanchenko’s remarks

“The effective execution of CGI initiatives helped us deliver a very pleasing financial performance over our just-completed Q3 FY22. In consolidating our base, we reported a significant surge in traditional background screening revenue, with more than 80% of this coming from repeat customers and 84% from B2B corporate customers. We are particularly delighted by revenue growth achieved by our newer Cited business, as its Real Time Compliance product offering successfully built scale, on the continued expansion of its client list.”

He believes that CV1 performance over the balance of FY22 will get a kicker from the recently signed Hireup contract and Atlas Iron’s decision to renew its contract. The company expects to provide details of additional Cited wins over coming months, as negotiations complete. 

You may read: CV Check (ASX:CV1) riding high on 'transformative' FY21; reveals 2022 strategy

Stock information: CV1 shares last traded at AU$0.120 on the ASX with a market capitalisation of AU$52.14 million (as on 27 April 2022, 12:51 PM AEST).