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Swift Networks Group Ltd (ASX:SW1), domiciled in Bentley, Australia, is a telecom company providing an entirely new in-room experience to its clients through its award-winning Digital Entertainment System. It provides services such as telecom, free-to-air TV, pay TV, and video on demand from Hollywoodâs largest studios, analytics, and integrated advertising. It enables people to connect, watch, play, and interact and provide meaningful insights and opportunities for new businesses. Its platform is deployed in such regions where reachability, scalability, and flexibility are difficult to achieve. It is running in more than 360 cities across various sectors such as mining, oil, gas, hospitality, aged care, etc.
Today, the company has declared its 1H FY19 results. SWI acquired Medical Media in December 2018 for A$25 million with full integration of combined Swift Media business from 30 June 2019. Â
The company reported total revenue of A$12.56 million in 1H19 as compared to A$10.38 million in 1H18 with a growth of 21%. This growth was on account of increase in content through 987% increase in sites, increase in reseller partnerships to 75%, the launch of a new entertainment platform for the hospitality industry, Lumiair, revenue through advertisement, and new contracts won during the half year including PINDAN construction contract, AST partnership, etc. Consequently, there was an increase in gross margin by 37% which was reported at 54% in 1H FY19.
It reported an increase of 167% in EBITDA being reported at A$2.67 million in 1H FY19 and the EBITDA margin increased to 22% with a growth of 121%. It further led toward a net operating cash flow of A$1.56 million with a growth of 25% and a cash balance of A$2.65 million as on 31 December 2018. There was a growth of 103% in cash balance on a YoY basis.
The company is generating revenue from more than 44,000 rooms and achieved the Class A performance share milestone. Prior to the acquisition of Medical Media, the company had a total of 168.587 million shares outstanding of which 121.313 million shares were ordinary, 38.382 million shares were performance shares, and 8.892 million were options. Post the acquisition; the company will have a total of 251.644 million shares outstanding with 136.263 million ordinary shares, 106.489 million performance shares, and 8.892 million options.
Out of the 38.382 million performance shares, the company will vest 16.67 million shares to the founder's account, and the founders will place these shares to a voluntary escrow account for six months.
The company plans to achieve the Class B performance share milestone with 53,000 rooms within the next 12 months.
Looking at Swift Networks Group Limitedâs stock performance and the return it has posted over the last few months, the stock has generated a positive return of 13.46% over one month. It settled at A$0.300 (as on 23 January 2019) with a surge of 1.695%, as compared to the previous day close of A$0.295. SW1 has a market cap of circa $35.81 million. Its 52-week high and low are marked at A$0.520 and A$0.210 respectively.
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