Alcidion Group (ALC) H2 2024 earnings summary

Executive summary

• FY24 revenue was AUD 37.1M, down 8% year-over-year, with 74% recurring revenue and gross margin of 86.1%.

• Underlying EBITDA loss was AUD 3.4M for FY24, improving to a AUD 0.6M loss in H2 due to cost-saving initiatives.

• Annualised cost savings of AUD 6.4M achieved, with Q4 staff costs reduced to AUD 6.2M and positive H2 operating cash flow of AUD 4.3M.

• Major new and extended contracts include North Cumbria NHS Trust (10-year, AUD 30–40M), South Tees NHS Trust (10-year, AUD 23M extension), Dartford and Gravesham (3-year, AUD 3.4M extension), and Hume Rural Health Alliance (AUD 4M TCV).

• Cash balance at 30 June 2024 was AUD 11.8M, with no debt.

Financial highlights

• Full year revenue of AUD 37.1M, down 8% year-over-year; annual recurring revenue increased by 6% to AUD 26.2M.

• Gross margin remained steady at 86.1%, expected to rise to ~90% in FY25.

• H2 saw a 19% reduction in staff costs and 24% reduction in other operating expenses compared to H1.

• Positive operating cash flow of AUD 4.3M in H2, reversing an outflow in H1.

• Recurring product revenue comprised 74% of FY24 revenue.

Outlook and guidance

• Entering FY25 with a stronger balance sheet and improved working capital.

• AUD 28M of contracted and renewal revenue expected to be recognised in FY25, excluding potential upside from North Cumbria.

• Targeting EBITDA breakeven at approximately AUD 36M in revenue, with confidence in achieving EBITDA positive results in FY25.

• Long-term contracted and renewal revenue of around AUD 130M through FY29.

• Increased procurement activity and market opportunities expected in H1 FY25.