Schrole reports a strong Q3 update across all key metrics and a strong growth outlook as it continues to pursue international growth opportunities and expand its product offering.

Rapidly growing edtech specialist, Schrole Group (ASX:SCL) has reported encouraging growth of 28% in September quarter cash receipts to $1.18m, and a strong growth outlook supported by good October 2021 sales momentum, and its growing sales team selling an expanded SaaS product suite across its growing customer base.

The company reported solid growth across a range of value drivers for Q3FY21 including customer numbers, software margins and average contract value.

Customer numbers for Schrole Connect, the company’s flagship product, rose by 9% to 419 in Q3 with 91% contract renewals.

Software margins increased to 34% in Q3, up from 26% in Q2, with further growth expected.

 

Strong outlook

Schrole described multiple factors supporting its strong growth outlook.

An encouraging October has set up a positive December Quarter 2021, which is historically the strongest quarter.

Schrole’s sales pipeline is growing, with several new high-profile schools and school groups, undergoing free product trials or in contract negotiations. New products and marketing events have helped grow the sales pipeline, such as inaugural Schrole Events online recruitment event, held on 27 October 2021, with strong school and candidate registrations.

The Company sees upside from global Covid-19 recovery, as international travel and commerce resumes.

 

Expanded Schrole HR SaaS suite

Schrole expects its expanded software-as-a-service (SaaS) product suite to provide increased cross and upsell sales opportunities, providing a complete solution to HR requirements, and revenue generation across the full calendar year.

Schrole HR is its flagship full SaaS product suite, comprising six Human Resources SaaS offerings, including Schrole Connect, Verify, Engage, Cover, Develop and Events.

 During Q3, updated Schrole Connect 3.0 was released with new functionality and enhanced existing features.

Recruitment events software solution Schrole Events was also launched, which provides interactive and regionalised online recruitment events for Schrole’s network of 400 schools and 140,000 teachers globally.

Schrole Engage, which is due for first release in first quarter 2022, providing staff management and onboarding software, will enable further cross-sell and sales generation across the full calendar year.

 

Expands direct sales team, targets new countries

Schrole is targeting further growth through its expanded direct sales team selling in new geographies, previously restricted due to the ISS sales distribution contract.

The Company is seeing strong engagement with customers from the northern hemisphere who have returned from summer break.

As a result, Schrole is experiencing strong sales pipeline growth and sales conversions late in the quarter and continuing into October 2021.

 

Managing Director Commentary

Schrole Managing Director Rob Graham said the company was pleased to report positive momentum in the September quarter.

“Not only have we grown cash receipts, but we have also grown key leading indicators of shareholder value such as software margin, average contract value and customer numbers,” Graham said.

“I am excited by the contribution and potential of our expanded sales team, who can drive revenue growth through cross/upsell, new geographies and penetrating new strategic target markets.

“We have a very promising outlook for Calendar Year 2022 based on the trends emerging from Q3 2021 and Q4 2021 to date.”

This article was developed in collaboration with Schrole Group, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

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