The Volpara Health Technologies Ltd (ASX: VHT) share price is taking off on Tuesday.
In afternoon trade, the health technology company's shares are up 13% to 72.5 cents.
Why is the Volpara share price rocketing?
Investors have been buying the company's shares today after responding very positively to its quarterly update.
According to the release, for the three months ended 30 September, Volpara reported record cash receipts of NZ$11.5 million. This was up 32% over the prior corresponding period.
In addition, the company finished the period with contracted annual recurring revenue (CARR) of ~US$28.4 million (~NZ$46.3 million), which is up over US$1.2 million since the end of June.
Also growing was Volpara's annual recurring revenue (ARR), which is now ~US$22.5 million (~NZ$36.6 million). This is up from US$21.5 million in the prior quarter.
But arguably the most important number on this release, and the one giving the Volpara share price the biggest lift, was its cash flow.
The company reported positive net operating cash flow of NZ$1.2 million for the quarter. This is the fourth consecutive quarter of positive net operating cash flow. Impressively, this means Volpara achieved its cash flow target 18 months ahead of plan.
In light of this achievement, the company is no longer required to provide Appendix 4C quarterly reporting updates. However, management advised that it remains committed to providing regular operational and financial updates to shareholders and will therefore release business updates periodically.
A milestone quarter
Volpara CEO's and Managing Director, Teri Thomas, appeared to be rightfully pleased with the quarter. Thomas said:
What a milestone quarter for us! I'm delighted to see current customers, happy with our software, expand their use of Volpara to save even more families from cancer. We had a record number of contracts up for renewal and customers have chosen to expand and extended their contracts with us for longer, with more software than ever before. Our record cash receipts reflect the positive impact we have on families, as happy customers pay their bills.
Our growth and financial strength, approaching US$100M TCV, allows us to turn increasingly to growth endeavours like a brand-new product, called Quiver, due out next year. Leveraging our Analytics platform, this new product provides administrative simplification for mammography centres so they can spend more time with patients. We do good and we do it well and that is reflected in this positive quarter.