Company news: TZ Limited
TZ Limited released its quarterly update (for the first quarter of FY-17, ending 30-Sep-16). We expected strong sales (revenue) figures for the quarter, as some projects had been delayed from last financial year. This was indeed the case, with $7.6m of sales, a 140% increase compared to Q1 FY-16.
The significant locker bank contract that TZ has with a large US logistics company underpinned sales. But other contracts and opportunities are also progressing well, for instance locker banks with Singapore Post and Pos Malaysia, as well as for Westpac and KPMG in Australia, and initial sales under the Ricoh distribution agreement.
Cash flow was negative $3.8m for the quarter. The company incurring cost of manufacturing goods for orders, with customer-driven deployment delays impacting cash receipts. This along with supplier payments impacted cash flow. We consider this part of the quarterly variation that can occur, especially with a company that is growing strongly. We will, however, monitor this.