Tesserent is to cut $1 million per year from its annual costs in one of the first moves by new chairman Geoff Lord.
The UXC founder announced the publicly-listed cyber security provider would strive to keep its running costs “as low as possible” after posting a $4.3 million loss in the last financial year.
New measures will mean Tesserent will end any of its external consultancy services as well as suspending directors’ fees for 12 months.
Lord said he hoped the moves would boost monthly cash flow and profitability, adding: “Achieving these goals will provide Tesserent with the strongest possible base on which we can build in FY2021 and beyond.”
The update to shareholders comes just a day after Tesserent announced Lord as a replacement for its former chairman Rob Langford, who exited in early December.
Lord pointed to Tesserent’s recently completed acquisitions of PS&C security division and enterprise security specialist Rivium, plus the pending purchase of North BDT, also from PS&C for $5.3 million.
“Tesserent has grown to be an increasingly diverse business spanning the cyber security sector with the ability to offer a compressive suite of cyber security services to new and existing customers,” he said.
Upon completion of the North BDT acquisition, Tesserent expects to deliver a run rate of $40 million by the end of this financial year, a 700 per cent increase from last year’s $5.2 million.
Although Tesserent has maintained relatively flat revenue for the last three years, it has remained in the red during this period with losses climbing from $3 million to $4.3 million between 2018 and 2019.
Citing his previous career building UXC -- now part of DXC Technology -- into an $800 million-revenue business, Lord said he saw potential for Tesserent to “copy that trajectory in today’s cyber security market”.
“Cyber security continues to be incredibly important to businesses, particularly to mid-market enterprises that we work with, and I believe this importance will continue to grow as increasingly technology and digital platforms become the operating standard across business, government and education,” he said.
“Tesserent is well-placed to take advantage of this growing demand, and we have expanded our capabilities at the right time.”