Nearmap Ltd update: 250+ US customers

Photomapping software company Nearmap Ltd (ASX: NEA) released a presentation today, outlining the company’s 3 main priorities for the next few months through to the end of June 2016.

And it was good news across all three factors.

Growth in Australia continues to be strong – with the company reporting that growth is ‘accelerating’. Pleasingly, that growth is coming from existing customers utilising more/higher services as well as the continued addition of new customers. Leverage also means Nearmap is delivering growth in revenues with virtually no additional expense to itself – although the company says it is conducting a radio advertising campaign.

Revenue growth and customer growth in the US is also accelerating. Nearmap is expanding its capture footprint in the US to target more than two-thirds of the population. So far that has led to signing up more than 250 customers – although deals range in size from US$1,000 to US$120,000. Customers include the Washington DC Department of Transportation and a number of small counties.

Many of those customers are likely to have signed up after the company implemented its paywall in November 2015.

Nearmap’s HyperCamera2 is undergoing test flights, with first commercial imagery expected by the end of June 2016. HyperCamera2 has a number of benefits for the company, including the ability to charge higher prices for a premium product.

Foolish takeaway

All in all, it’s good news for Nearmap and its shareholders. The US has taken longer than expected to bear fruit, but that is clearly starting to improve, while Australia continues to chug along nicely. If the company can achieve a similar level of success in the US as it has in Australia, Nearmap’s shares could be worth far north of their existing price of 37.5 cents. I continue to be a very happy shareholder.

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Motley Fool writer/analyst Mike King owns shares in Nearmap. You can follow Mike on Twitter @TMFKinga

Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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