The financial report released on Friday reveals a small increase of 1.2% in revenue for NetComm to $47 million with the loss attributed to investments made in infrastructure and workforce.
Announcing the appointment of Sheridan, who has been acting CEO for six months, chairman Justin Milne said, in the last few months, Sheridan had helped sharpen the company’s focus on its major opportunities and had made a “very significant difference to the culture of the company”.
"The board is very confident that we now have the right man for the job ahead”.
The company's investments in infrastructure and workforce included what Sheridan says was an increase in NetComm's engineering count from 91 to 125, sales and marketing staff from 29 to 34 and other staff from 23 to 31.
According to NetComm, the reinvestment in staff and infrastructure is in line with its wider growth strategy to enhance its capabilities as it pursues multiple global opportunities.
“The past six months saw clear evidence of NetComm Wireless’ transition to a company that derives its revenue from large telecommunications and M2M contracts globally.” Sheridan said.
“With substantial global growth opportunities available in our key markets, we are investing our growing revenues and underlying earnings to support long-term initiatives within our Growth Businesses.
“We have added 45 engineers to now have 125 based in Australia and the US employing our ‘Listen. Innovate. Solve.’ approach to develop bespoke telecommunications technology solutions.”
The financials show that revenue from Growth Businesses increased 16.4% to $36.3 million — or 77% of group revenues — and reflecting what the company said was the continued roll-out of the NBN contract and growing M2M project revenues.
NBN Co, the company building the NBN, placed a multi-million dollar order in November with NetComm for the supply of distribution point units.
Under the contract, the connection units, both single and four-port, are used for connecting to copper from the driveway and will be used to provide what is known as fibre to the distribution point (FttDP) connections or what NBN Co calls "fibre to the curb".
Sheridan said winning the major contract was a “clear sign of NetComm Wireless’ global telecommunications technology leadership”.
According to him, the initial order commitment would generate approximately $28 million in revenue on delivery to NBN Co, which is expected between June to August.
“We expect to quickly move to a monthly supply of DPUs in FY18 as the NBN Co ramps up its installation of this new technology. It excludes investment within operating expenditure relating to additional staff and infrastructure to support long term growth initiatives and share-based expenses since 1H FY2015.”
Sheridan said NetComm was well positioned to continue its growth trajectory.
“The NBN contract win was a major milestone for our company, building on our existing business relationship with NBN Co. Material revenues are expected to commence from this contract between June to August this year.
“We will continue to benefit from the roll out of the Ericsson/NBN project over the second half of the year and will see some small revenues emerging from the US Fixed Wireless contract ramp up.
“We passed a key technical milestone for our US fixed wireless contract in August last year. Initial orders have been received as part of eco-system testing, with first units to be delivered from May to August 2017.
“The US telecommunications carrier we are working with has announced that it has received US federal government funding to ensure 400,000 rural premises are available for service before the end of this calendar year. Revenue from this contract is expected to continue to ramp up in FY18 as the US telecommunication company rolls out its fixed wireless solution.”