Way2VAT Ltd (ASX:W2V) has delivered a strong March quarter, with a cash balance of $2.674 million, driving “solid revenue growth” across all of its revenue streams.
During the quarter, the fintech leader recorded an increase in transaction volume of $2.23 million, up 62% compared to the corresponding quarter in 2021.
On the operations front, W2V signed new deals with ten major multinational enterprise clients during the quarter taking its enterprise numbers to 210 – a 40% increase in 12 months.
Also, the number of small and medium-sized businesses (SMBs) accessing Way2VAT capability through accounting software integrations increased by 7%, from 700 to 750.
Looking ahead, W2V is looking forward to the developments in its product development pipeline to further optimise its suite of products as well as accelerate revenue growth.
“Solid revenue growth”
Commenting on the company’s achievements over the March quarter, W2V founder and CEO Amos Simantov said: “We continued the momentum we created last year in the first quarter of 2022 with the company experiencing solid revenue growth across all segments and markets.
“We have grown our enterprise customer base to 210, while our SMB clients have increased by 7% from 700 to 750 through indirect sales with key new and existing partnerships like Circula, Xero, Sage, Zoho, WebExpenses and Allocate.
“With our highly scalable technology, we are tracking gross profit margins of 80%, as we leverage positive market conditions as our growth path accelerates.
“Way2VAT has begun to harness our global leadership in the technology of integrated VAT claim and return solutions that we operate in more than 40 countries and over 20 languages.
“We strengthened our platform presence in the DACH economies of central Europe - Germany, Austria and Switzerland.”
Operational updates
During the quarter, W2V has signed ten major multinational enterprise clients including Playmobil, a top-30 global toy manufacturer and enterprise headquartered in Germany.
Other Enterprise clients signing with W2V for similar services during the quarter include:
- Super Smashing Ltd (Blink), headquartered in London, is the world's first enterprise app designed exclusively for frontline workers that currently supports 80,000 key workers;
- Resources Global Professionals, a global consulting firm with more than 3,000 employees supporting a broad range of corporate functions through offices in 20 countries across North America, Asia Pacific, Europe and Latin America;
- TalkTalk Telecom Group Ltd, a provider of pay television and internet access services to businesses and consumers in the United Kingdom; and
- Luxoft Professional LLC, the design, data and development arm of DXC Technology, providing bespoke, end-to-end technology solutions for mission critical systems, products and services across 21 countries throughout Europe, Asia Pacific and the US.
On the partnership front, W2V has partnered and integrated onto platforms such as Allocate, Elmo, Yokoy, Zoho and Xero enabling Way2VAT to strengthen its presence as a leader in automated VAT recovery software for the SMB market.
Product development pipeline
Leading the way is W2V’s world-first Smart Spend Debit Mastercard® integration technology, an end-to-end process from the capture of the receipt through to payment that automatically analyses, reconciles, sorts, and submits documentation to foreign tax authorities.
The card has a unique ruling engine that controls expenses per transaction by merchant, expense category, date, amount, and frequency. It provides businesses with more control over user spending and improves compliance, visibility, and transparency.
During the quarter W2V has reached ‘production-ready’ status for a new web application for full administration of users, corporate debit cards and expenses, and a new mobile application for cardholders/employees to track and manage their expenses on the go.
The company is currently working on the development of infrastructure on the AWS cloud to support platform scalability and quick rollout of new features including:
- a new AI-powered feature that authenticates the receipt’s image against the made transaction data and alerts the user about possible mismatch;
- front-end development for a rich view of a new visual theme based on design guidelines to match the product’s target market and personas; and
- back-end development for data handling, business logic, workflows and integration with third-party providers.
Post reporting period
Post reporting period, W2V entered a partnership with Circula, the largest expense management solution provider in Germany, to offer Circula clients the use of its automated VAT claim and return solutions product for SMBs through two seamlessly integrated systems.
Consequently, the new partnership will operate across thousands of organisations throughout Europe, with a particular focus on the DACH region, comprising Germany, Austria and Switzerland.
The company also partnered with Railsbank to launch the Smart Spend Debit Mastercard® – the world’s first spend card for the SMB and Enterprise market that fully automates VAT/GST returns from end to end.
Forward plan
Commenting on the company’s FY22 outlook Simantov adds: “Our strong growth during the reporting period reflects our increased marketing and sales efforts and product evolution which has enabled us to harness improving market conditions with business, international and domestic travel and foreign Accounts Payable returning to more normal levels of activity since the beginning of the COVID-19 pandemic.
“The next 12 months are shaping up to be a very exciting time for the company.
“The world’s first debit card with a VAT/GST embedded engine, our new Smart Spend Debit Mastercard will enable companies to improve their expense management and payment solution while saving costs as well as boosting their bottom line.
In addition, as part of our growth strategy to expand the product line, we are finalising a complementary product for our VAT/GST automated platform based on AIA (automated invoice analysis – Way2VAT patented technology), AI and computer vision technology.
“These product initiatives will provide additional scale for our patented technology platform.
“These will fuel the growth of our strengthening partner, Enterprise and SMB revenue so we can harness the accelerating trend for companies to automate and digitise their tax and compliance-related processes.”