Home security provider Scout (ASX:SCT) has surprised investors, delivering a 27% quarter-on-quarter increase in cash receipts in the March quarter – a particularly pleasing result, with the December quarter traditionally considered the strongest period for the company.
Scout has booked more than $400,000 in cash receipts, with the company reporting a sustained boost from its emerging monitoring services product, which yields high-margin recurring monthly revenue.
The company’s annualised recurring revenue also continues to skyrocket, growing at a rate of 27%.
March quarter results improve its year-on-year annualised recurring revenue to more than AU$0.9 million, nearing in on the milestone mark of $1 million in revenue.
Scout’s mix of sales continues to shift toward its monitoring services, which represented more than 50% of the company’s overall business throughout the March quarter.
“Scout had a great start to the year and we are particularly pleased to see recurring revenue form a growing component of our revenue. That quarter-on-quarter and year-on-year RMR growth highlights the growing power of the Scout subscriber base and the scalability of the business,” Scout Security CEO Dan Roberts said.
With the holiday period typically driving our strongest quarterly revenue, for Scout to have revenue in the March quarter exceed the December quarter by 27% represents pleasing growth and a strong start to the year.
“The extent to which Scout grew its base of customers and recurring revenue this quarter underscores the interest in DIY home security solutions and the power of Scout’s sales channels when fully in stock, bolstered by proactive marketing,” he said.
The company also reports further encouraging signs, with a higher percentage of new customers opting to subscribe to the higher-value US$20/month professional monitoring plan.
The sales pipeline also continues to widen for Scout, with the company preparing to make available a 1080p HD camera add-on to its existing products.