Australia-based job search site AD1 Holdings published a business update for the third quarter ended 31 March 2024.

The ApplyDirect division saw continued growth during the quarter with revenue of AUD 215,000 (USD 140,388), an 8% improvement on the prior year. The division has grown 30% year-to-date and has significantly reduced its cost base on an annualised basis.

The group said the Art of Mentoring (AoM) North American division has now surpassed AUD 1 million in revenue after entering the North American market only 20-months ago.

“AD1 has seen a tremendous demand for the AoM product across the association and corporate sectors,” the group stated. “The division has re-signed 90% of its North American customers and the residual 10% are committed to sign before the end of the financial year. More than 80% of customers are now resigned on 24-month contracts through to 60-month contracts.”

Cash receipts for the North American division grew by 154% in the quarter compared to the prior corresponding period.

AD1 Holdings said the group delivered cash outflow savings of 67% year-on-year and a normalised outflow savings of 45%.

The third quarter also saw an 88% increase in net operating cash against the prior year period to deliver an operating cash outflow of AUD 17,000 (USD 11,103). The result includes approximately AUD 240,000 (USD 156,712) in costs that were due to reductions in staff therefore the normalised result would have been an AUD 222,000 (USD 145,003) operating cashflow surplus, representing a 258% improvement over the prior year.

During the quarter AUD 0.7 million (USD 457,219) of savings were removed from the operating model. These are permanent savings across every division within the group as AD1 looked to continually test the business model. Management said it believes that as the company migrates to a new platform for ApplyDirect and continues to find efficiencies within AoM, that the team is right-sized until growth is signed and committed.

AD1 Holdings CEO Todd Perkinson, said, “We are pleased to have completed a quarter of significant transformation of the AD1 group. Our continued focus on a new strategic direction across restructuring, implementing cost controls and maintaining a strong pipeline has been positively reflected in an ARR (annual recurring revenue) increase over the quarter. Not only have we been contracting new customers, but existing customers have expanded programs and number of users within the platforms.”

“AD1 has in place three pillars from which we will grow and execute our plans; (i) a clear mandate to right size the business, (ii) a strong pipeline of potential new customers across Australia and North America and (iii) a dedicated and well-motivated team who have strong alignment to the agreed strategic outcomes,” Perkinson said.

Looking ahead, AD1 said it is shifting into a strong sales and partnership focus, all while ensuring deeper customer relationships and the right business model to deliver effective outcomes. The new business direction allows more streamlined operations and resource efficiencies, meaning that there will be greater opportunity for cross-selling and collaboration between divisions.

Supported by a robust sales pipeline in Australia and North America, ongoing execution of the cost reduction program, and solid customer retention from both AoM and ApplyDirect, the group anticipates a more defined focus on profitability, projecting to deliver stronger and improved positioning for the remainder of FY24.

“This strengthening of the overall business will ensure that the processes, people and technology are well positioned to deliver the FY25 strategic and operational goals,” the company stated.

“The company continues to undertake a strategic review of the entire business, the outcomes of which will be released to the market upon completion in the coming months,” AD1 Holdings stated.

AD1 Holdings shares closed at AUD 0.009 (USD 0.0059), no change on the day and 125.00% above the 52 week low of AUD 0.004 (USD 0.0026) set on 17 November 2023. The company has a market cap of AUD 8.09 million (USD 5.3 million).