If you are following my 2013 stock of the year pick Cortex Business Solutions (CBX.V) you will note that the company reported earnings yesterday 12/20/12. Although some weakness was noted by the company management in the oil and gas sector, which is the company's primary customer base, all metrics are moving in the right direction. In fact the market seemed to like the news as the stock moved up 14% higher today. I would probably wait for a pullback before buying shares at this point. Here are the highlights from the press release.
Revenue was $1.4M in the first quarter of the fiscal year of 2013 ("Q1 F2013"), compared to $1.2M in the same quarter fiscal year 2012 ("Q1 F2012"), reflecting an 18% growth in total revenue. Included in the total revenue is access and usage fee revenue of $1.2M Q1 F2013 compared to $885K in Q1 F2012 representing a 40% increase in recurring revenue growth quarter over quarter.
At the end of the Q1 F2013, Cortex had signed agreements with 56 buying organizations ("Hubs"), 14 more than at the end of fiscal 2012. Of those, 34 have progressed through the pilot phase and were available to receive invoices from their suppliers electronically. Hubs are the main driving force for growth in the Company as each new Hub brings a list of additional customers to the Network and provides additional destinations for existing Network users to send invoices to. During the Q1 F2013, Cortex added 507 new customers, an increase of 6% over July 31, 2012 and increased transactions through the system by 342,997, an increase of 16% over Q4 F2012.
Cortex had a net loss of $1,840,714 in Q1 F2013, or $0.01 per basic and diluted share, compared to net loss of $2,065,191 in Q1 F2012, or $0.01 per basic and diluted share. This improvement in net loss is the result of increased revenue in conjunction with a 9% reduction of expenditures compared to Q4 2012.
"Cortex continues to grow our Network of companies, transactions and revenue during a time period when drilling activity in the oil and gas industry is down considerably from last year. This is a direct result of our investments in market expansion, productivity improvements and technology over the past year", said Art Smith President & CEO of Cortex. "We expect 2013 to be a significant year for the Company in terms of both revenue growth and productivity improvements, as we expand our Network in Canada and the United States"
Everything is on track for the company to become cashflow positive this year and the company management was comfortable with reaching their 2013 exit goal of having 12,000 active contracts on the network.
Disclosure: I am long CTXZF.PK.