Quixant senses jackpot outside of gaming
Cambridge gaming technology company Quixant is cashing in on a new vertical market that more than offsets fluctuations in traditional casino-style business.
Quoted on AIM in the UK, Quixant reveals that subsidiary Densitron has offered a potentially lucrative roll of the dice in non-gaming technology sectors, including broadcasting and medical business.
In an update on trading for the six months to June 30, chief executive Jon Jayal says Densitron – a business unit specialising in human machine interaction for markets outside gaming – is playing a blinder for the group.
He said Densitron had experienced healthy demand from a range of industrial sectors during the period with a highlight being the medical market which has seen elevated demand from new and existing customers for a range of display products.
Jayal says this sector represents an exciting growth area and management is actively exploring further organic growth opportunities. Additional strategic business wins in the broadcast sector with customers such as Panasonic leave Densitron well-positioned for growth as the economy emerges from lockdown.
Gaming, which is the key market for the group, has seen only minimal orders during the past three months, with most of the gaming clients closed due to the COVID-19 pandemic.
Casinos and other gaming venues, however, started to reopen during the latter part of the second quarter and whilst the speed of recovery of this part of the group’s revenues cannot be predicted, Quixant saw an improvement in activity in June.
A downturn in revenues had been mitigated by the implementation of a swift overhead cost reduction programme and a streamlining of the group’s product base which, whilst thorough, have been implemented so as to both leave the company well-positioned to support customers in their recovery and also explore new opportunities for growth.
The board says it is also pleased with the group’s working capital position in the period. Densitron’s robust trading performance combined with strong collection of receivables from gaming customers and the benefits of a swiftly executed cost management programme has yielded a solid net cash position of $14.2 million. That compares to $16.1m on December 31.
The group also has additional unutilised lines of credit of over $12.4m, including a new $9.4m UK government-backed Barclays revolving credit facility, should additional facilities be required.
Jayal said: “Given the economic circumstances, I am pleased with the performance of the group in the first six months of the financial year. Our Densitron business, which celebrates its 50-year anniversary in 2020, has performed well and has demonstrated the benefits of a diverse revenue base, and an ability to withstand economic shocks.
“Our strong net cash position entering the pandemic has remained largely intact, supported by robust Densitron trading, a swiftly executed cost reduction programme and sustained cash collection from our gaming customers, who have appreciated the flexibility and partnership we have offered them in this challenging period. I am pleased to see some early signs of activity beginning to return for some of our gaming clients.
“Quixant’s strength of customer relationships and flexibility of approach has enabled the group to drive some exciting evolutions in our offering and business model during the past few months. This, combined with our solid balance sheet, places the company in a strong position to grow over the longer term.”