Netcomm's move away from consumer market pays off

Netcomm's move away from the consumer market appears to be paying off, with the company back in the black for the 2014 financial year.

More than half the revenue at Netcomm is now coming from machine-to-machine (M2M) devices used to connect the likes of smart meters, medical equipment, vending machines, elevators and digital signs - up from 20 percent in the 2013 financial year.

Growing M2M sales helped push Netcomm back into profit - albeit a small one - after a loss in 2013. The company made a $1 million profit after tax in 2014, compared to a half-million dollar loss last year.

Revenues were up significantly, jumping by $21.7 million to $64.6 million. Earnings before interest, tax, depreciation and amortisation were $5.2 million, compared to a $0.8 million earnings loss in 2013.

Smart metering contracts were a big winner, increasing from a zero base in 2013 to $14 million.

Netcomm's business with Ericsson for the NBN was another key driver of M2M revenues, as well as income from a project with Cubic Transportation for the Opal Card transport ticketing system in New South Wales.

Key partnerships with Kanematsu Communications, Etisalat Group and Vodafone Qatar were also announced in the last 12 months.

The company expects "substantial" growth in the M2M market. Netcomm is in discussions and trials relating to a number of new M2M and smart metering opportunities in Australia, the US and the Middle East, said chief executive David Stewart.

"Even if one of two of these opportunities translate into orders, they will be transformational to the business and result in a substantial lift in revenues and earnings over time," he said.