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ClearStar revenues up

By BFN News | 01:46 PM | Thursday 23 July, 2015

ClearStar expects revenue for the first half to be approximately $7.5m - 43% up on the corresponding period in 2014. The technology and service provider to the background check industry says that as stated in the FY 2014 results announcement on 16 March, it has maintained the momentum of the second half of 2014 into 2015. In H1 2015, the Medical Information Services and Direct Services divisions achieved substantial growth, and the company received increased demand for screening services provided to its Channel Partners and Consumer Reporting Agencies. The company says it is also pleased to report that the integration of the SingleSource acquisition has resulted in a significant increase in direct sales customers with an approximate revenue increase of $1.3m. Consequently, the company expects revenue for the first half of 2015 to be approximately $7.5m, representing a 43% increase over the equivalent period in 2014. Additionally during H1 2015, ClearStar experienced gross margin improvement primarily due to economies of scale along with a favourable shift in the product mix with an increased contribution of revenues from higher margin direct sales. The company anticipates the gross margin percentage for H1 2015 being higher by more than 200 basis points compared with the same period of the previous year, and expects this trend to continue due to both the revenue mix and purchasing economies. The increase in revenue was due to strong sales growth across all three of the Company's divisions. In the first six months of 2015, ClearStar processed approximately 3.6 million screening services on over 1.1 million people that were provided to over 23,000 end users. The MIS division was awarded its largest single contract to date in February, which is expected to be worth $1.3m-$1.5m annually, which is due to start generating revenue in Q3 2015, which is a slight delay from that originally anticipated. This service will be delivered via the Company's paperless chain of custody software (WebCCF). In the newly-formed Direct Services division, the integration of SingleSource expanded ClearStar's number of direct sales customers to over 2,000. Excluding the contribution from SingleSource, direct sales revenue grew from approximately $150,000 in H1 2014 to $440,000 in H1 2015, an increase of approximately 190% year-on-year. Additionally, in July 2015, the Company won a direct sales contract with a division of one of the world's largest security companies, with anticipated initial revenues of approximately $250,000 annually. This contract is expected to start contributing revenue in Q3. The company's direct sales pipeline is currently over $10 million in annualised revenue, representing a significant expansion. At 1:46pm: (LON:CLST) Clearstar Inc. Ord Usd0.0001 reg S share price was 0p at 60p (LON:CLSU) Clearstar Inc. Ord Usd0.0001 Di share price was 0p at 60p Story provided by

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