July investor update


Transcription of Finance News Network Interview with Inabox Group Limited (ASX:IAB) Managing Director and CEO, Damian Kay
Clive Tompkins: Hello Clive Tompkins reporting for the Finance News Network. Joining me from Inabox Group Limited (ASX:IAB) is Managing Director and CEO, Damian Kay. Damian, welcome back.
Damian Kay: Thanks Clive, it’s good to be here.
Clive Tompkins: It’s been a busy quarter for the company. Can you start with an update of the wholesale business?
Damian Kay: The wholesale business is performing really well. In the last four weeks, we’ve signed a couple of major customers and even migrated some of it. Solnet was a good win for us. They bought over 2,000 services and we’ve just managed to sign another major reseller, in the market. Our services being fixed warranty sell services, typically. There’re a few other types of services in there, but they’re the main what we’ve migrated. And Total Telecom will start migrating in the next two to three weeks.
So there have been some really big changes in the wholesale area. I think as the wholesale market starts to consolidate, we’re starting to see a lot of people interested in what we do, given we’ve been around so long.
Clive Tompkins: How has the enablement business been performing?
Damian Kay: The enablement business is still performing strongly. You know our key enablement customer, continues to put a lot of services on. As we’ve talked about before that’s on a fee for service basis. Our new enablement customer, our large enablement customer that we’ve recently signed, they’ve just now launched and starting to put services on. And we look to see some really good things out of them, moving forward. But still the main driver of our enablement business, is that key cornerstone customer that we signed a couple of years ago. And they’re really starting to really ramp up again.
Clive Tompkins: How is the Anittel business performing?
Damian Kay: That’s going really well, there are two really big sides to the Anittel business, being HCS the big rollouts in Tasmania with the Tasmanian Government. And also the IT services side, where we outsource the IT services, or provide outsourced IT services. The HCS side, or the Hosted Collaboration Solution, rolling out at the moment to the large hospitals in Tasmania, that’s on track now. And we’re currently rolling out Launceston hospital, followed by the other major hospitals within the State. And that’s a lot of work by a lot of people and that’s going well.
In terms of the IT services side, that’s continuing to flatten out. And Anittel’s been, obviously after seven years of $56 million of accumulated losses, it was always a big job to turn that business around. And I’m pleased to say that in May and June, we will actually deliver profits out of that business after such a long period of losses. To turn that business around has been such a massive job by everybody.
Clive Tompkins: There’s a structural change occurring called Tin-to-Cloud. What is it and how are you positioning Inabox to take advantage of this?
Damian Kay: Tin-to-Cloud is a term used to talk about organisations and companies, typically larger ones, taking their servers and equipment from on-premise to off-premise. So data centres, centralised data centres, enterprise cloud environments. So basically what was a three to five year refresh cycle and big capital expenditure, it goes into the Cloud. And there’s a transform or an evolution of it going into the Cloud, where it’s more on a subscription based model, rather than a three to five year refresh cycle.
And one of the things of why the Inabox Group bought Anittel was to actually help with that transformation, and transform our business to follow that structural change. Because we now have a lot of Cloud products, enterprise Cloud products on Cisco and Dell platforms that we’re able to actually help migrate our customers, into the Cloud. And actually help with that transformation and actually be there to help them, on a consultative basis. And also provide the services that they require, to be able to do that.
Clive Tompkins: Damian Kay, thanks for the update.
Damian Kay: Absolute pleasure.