Telecommunications company United Networks (ASX: UNL) is set to increase its national footprint significantly with the expansion of their services into Western Australia as part of their renewed strategy to build recurring revenue streams.
The new contracts in Western Australia are expected to deliver a fresh $600k in recurring revenue while enhancing their services to existing national customers and creating cross-sell opportunities.
“This is an exciting next step in our expansion plans as we increase our national footprint in line with the Company’s long-term growth strategy,” said United Networks CEO, Victor Tsaccounis.
“We now have an experienced team in place ready to further expand the Company’s business in the promising West Australian market.”
The national expansion comes a week after United Networks successfully raised $5 million from institutional investors at an Offer Price of $0.063 per share with funds to be applied towards potential acquisition opportunities in the telco and IT/managed services sector.
It would follow a successful strategy that the Company has implemented over the past 12 months which culminated in strong FY20 results where United Networks delivered a 440% increase in revenue to $16.3m and underlying EBITDA of $1.7m. This was primarily brought on by 6 acquisitions made over the year with accretive earnings and recurring revenues the focal point of their acquisition strategy.
Assuming travel restrictions will ease over the next 12 months, United Networks has plans to re-launch their Global Travel Safe products which include global SIM cards, international wi-fi access and SOS alerts from around the world.
“Following the successful completion of the recent capital raising, we look forward to keeping the market informed on the Company’s strategy to drive increased shareholder value through both organic and EPS accretive acquisitive growth opportunities,” said Tsaccounis.
UNL shares have held their momentum post-raise, opening today at $0.098 following news of United Networks’ national expansion.
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