The Mach7 Technologies Ltd (ASX: M7T) share price is surging higher on Thursday.
In afternoon trade the enterprise imaging platform provider's shares have jumped 8% to $1.31.
This leaves the Mach7 share price trading within touching distance of its record high of $1.36.
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Why is the Mach7 share price surging higher?
Investors have been buying Mach7's shares today after it released its second quarter update.
According to the release, the company achieved record cash receipts of $4.25 million for the quarter. This was up 13% from $3.76 million during the first quarter of FY 2021.
This was driven by a 130% increase in sales orders compared to the first quarter. Sales orders for $7.6 million in new contracts (total contract value) were generated during the period. This took its half year sales orders to $10.9 million, up 17% on the prior corresponding period.
Pleasingly, management is expecting its cash receipts to remain strong in the third quarter given its new larger customers.
Another positive was that the company's operating payments (net of interest received and government rebates) for the quarter came in at $4.57 million. This was down from $5.58 million during the first quarter and led to the company reporting an operating cash outflow of $0.32 million for the quarter.
Management advised that its cash payments for general operating expenses are expected to continue to fall as the full effect of operating synergies from the recent acquisition of Client Outlook are recognised.
At the end of the quarter, Mach7 was in a strong financial position with $14.4 million cash on hand and no debt. This takes into account a payment of $2.7 million that was made to the sellers of Client Outlook $2.7 million for the working capital remaining in the business at acquisition date.
No guidance was given for the second half. However, management intends to provide investors with a full business update when it releases its half year results on 18 February.
