Special Report: After strong demand for a $15m capital raise, Netlinkz has laid out its strategic priorities for the year ahead.

Strong FY21 revenue growth and cash in the bank would enable the network software company Netlinkz (ASX:NET) to push ahead with its identified growth strategy as outlined in its most recent EGM held on 16 June 2021.

In the EGM presentation, the company highlighted three clear strategic priorities as it pursues a global growth for its patented virtual secure network (VSN) technology.

A core advantage of the VSN is its capacity to facilitate secure data transmission across networks that include mobile devices, allowing for improved cloud connectivity and faster communications.

The technology can also be layered onto existing legacy infrastructure, providing a cost-effective way to rapidly scale data transmission networks.

With a globally expanding client base complementing its core market in China, the company’s value proposition was recognised by retail and institutional shareholders who recently participated in a $15m capital raise to fund growth.

Strategic plan

In the coming year, Netlinkz has hinted at a three-fold strategic plan to drive its near-term growth.

Continuing revenue from a “very strong” Chinese market coupled with planned growth across the Asia-Pacific region sets the Company up for robust growth in FY22.

Netlinkz also expects to generate margin growth through recent pricing changes to its Network-as-a-Service (NaaS) software subscription platform including margins from any accompanying hardware sales for future client deployments.

The company will also look to scale-up across a global suite of enterprise clients, led by major markets in India and Europe where sales are expected to commence within the next 12 months.

Netlinkz will also update the feature set on its VSN platform, simplify deployments and continue to build out the scale capability of the network.

With its renewed balance sheet, the company remains open to evaluating opportunistic M&A situations in the APAC region, provided they are earnings accretive and represent a clear short-term path to operational synergies.


Simple capital structure 

The company also reduced its outstanding debt from $14.1m to $1.3m and onboarded a “strong institutional investor base” as part of its recent capital raise.

It leaves the company ideally positioned to scale-up with a market-leading product for the new data economy, allowing improved data transmission with more flexibility and maximum security.

“Most enterprises still transfer data on legacy infrastructure with serious limitations,” Netlinkz explained.

Those networks can’t keep up with modern data requirements, meaning a solution is required to provide low-cost cloud connectivity.

In that context, “the VSN enables enterprises to hyper scale legacy networks, maximising network speed and security”.

And on a global scale, the company is building out “the future infrastructure for data transmission”.

This article was developed in collaboration with Netlinkz, 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.