The announcement followed commitments received by the company from institutional and sophisticated investors during its $3.5 million capital-raising in mid-December.
Analyst comment: this is an outstanding result for ApplyDirect, as we did not expect it to win another major government contract for some time. The new partnership, which augments the company's existing relationship with the NSW government, means that ApplyDirect now powers two of Australia's largest employers; combined, they represent over 800,000 employees, or nearly 50% of all Australian public-sector jobs.
The result indicates, we believe, that larger organisations in Australia are recognising the benefits of controlling their own careers pages, rather than availing themselves of more traditional routes like job noticeboards and recruitment agencies.
Further, ApplyDirect's contract with the Victoria government, combined with its current NSW government contract, creates more than 300 additional opportunities for the company within the individual departments and agencies (such as individual hospitals) of both governments, since they may also decide to control of their own job portals. And, while it won't happen overnight, we believe there will be a high conversion among these groups in coming years.
Valuation: despite this excellent result for ApplyDirect, our valuation has decreased to $0.43/share (previously $0.58), due largely to increased dilution from the recent capital raising. We also rebalanced our sales forecasts for each business unit; however, that had little effect on our valuation, since increased revenue from the Victorian government contract was offset by the possibility of reduced sales to medium and small enterprises in the coming year. We will review our sales forecasts once half-yearly results are in.
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About ApplyDirect Ltd
ApplyDirect Ltd (ASX:AD1) has developed an innovative on-line platform that links job candidates directly to live job opportunities on employer websites. The jobs are collated and advertised on the ApplyDirect platform using a sophisticated search engine to enable easy access by job candidates. ApplyDirect provides a seamless way for candidates to identify job opportunities and then apply directly to the employer via the employer’s internal recruitment system.
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