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FirstWave drops further into the red

FirstWave drops further into the red

Revenue also down by 6.6 per cent to $8.3 million

Credit: Dreamstime

FirstWave Cloud Technology has seen its post-tax loss tumble by just over a quarter, year-on-year, in its FY20 results.

For the financial year ending 30 June, FirstWave reported a loss from ordinary activities after tax of $13.8 million, representing a decline of 25.2 per cent, year-on-year.

This sees the company reporting a loss for its fourth financial year in a row, starting from FY17.

Revenue for the financial year was also down slightly, by 6.6 per cent, to $8.3 million, with $7.9 million of this attributed to Australia and $386,201 to international dealings.

This in part was due to licensing and support revenue slipping 12.7 per cent, which represented 90 per cent of the company’s total revenue.

The company outlined that revenue growth seen in the first half of the year was squashed by the coronavirus pandemic in the second half, according to its financial report submitted to the Australian Securities Exchange (ASX). However, the company is cautiously optimistic for its growth chances moving forward.

One of its priorities for FY21 include increasing sales and marketing investment to expand its partner channel with billing partners growing from 26 to 40.

Earnings before interest, tax, depreciation and amortisation (EBITDA) were also down, with losses increasing by 6.9 per cent to -$9.3 million.

The company's major revenue generator, a single external customer, was responsible for 96 per cent of the company’s consolidated revenue at $7.7 million, down $900,000 from last financial year.

In addition to expanding its channel partners, its priorities for FY21 also include plans to incentivise its own sales team with those of its partners, add additional security appliances onto its Cloud Content Security Platform, adding advance detection and response capability to all of its offerings and scale platform infrastructure and customer operations for 24/7 delivery support.

“The consolidated entity has provided a prospective forward plan to investors and shareholders which assumes business activity levels will be restored to pre COVID-19 levels in all geographies by the beginning of the second quarter of FY21,” the report read.

“This may well not be the case as the situation is unpredictable and as a consequence, so is the economic environment, the response that may come from our partners and end customers, and any impact this may have on our FY21 plan.”

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