The Nearmap Ltd (ASX: NEA) share price will be one to watch closely on Wednesday morning.
This follows the release of a positive announcement by the aerial imagery technology and location data company after the market close today.
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What did Nearmap announce?
This afternoon Nearmap revealed that its strong performance in the first half has continued into the second half of FY 2021. As a result, the company is increasing its full year guidance for annual contract value (ACV).
According to the release, the company now expects to deliver ACV of $128 million to $132 million in FY 2021. This compares to its previous guidance of $120 million to $128 million. It will also be a 20% to 24% increase on FY 2020's ACV of $106.4 million.
Management advised that it has seen momentum continue with growth across its core industry verticals from both new and existing customers.
It believes this further reinforces the attractiveness of the company's subscription business model, the benefits of its technology leadership position, and the differentiated customer offering which combine to give Nearmap a significant competitive advantage.
In addition, the company revealed that it continues to invest the proceeds from the FY 2021 capital raise into key growth initiatives. This includes the development of HyperCamera3, which remains on track to be rolled out in FY 2022.
Positively, with each of the investment initiatives on track and with continued momentum in ACV growth, management now expects its net cash outflow to be less than $10 million this financial year.
On track to deliver growth targets
Nearmap's Chief Executive Officer and Managing Director, Dr Rob Newman, was pleased with the company's performance. He also believes Nearmap will deliver on its growth targets.
Dr Newman said: "With our refined go-to-market strategy still at a relatively early stage, I am very encouraged by the strong growth we are seeing across our ACV portfolio."
"This performance validates our strategy to focus on our core growth verticals of insurance, government and roofing, with the adoption of premium content types particularly strong from these verticals, driving returns from the investments we made into new and expanded content."
"The early success of our refined go-to-market strategy – which has delivered strong growth in FY21 – and the continued deployment of investments into this strategy gives us confidence that we remain on track to deliver on our 20- 40% ACV growth targets from FY22 onwards."
Nearmap share price performance
The Nearmap share price is down 9% since the start of the year.
Shareholders will no doubt be hoping this update gets it heading in the right direction again.
