Gentrack Group (GTK) H2 2024 earnings summary

Executive summary

• Revenue grew 25.5% year-over-year to $213.2m, with strong performance in both Utilities and Veovo segments and underlying growth of 50% excluding $27.6m in FY23 one-off revenues from insolvent customers.

• EBITDA was $23.6m, up 1.7% from FY23, impacted by a $7.1m payroll tax charge on LTI schemes due to share price growth; underlying EBITDA before LTI costs rose 42% year-over-year.

• Statutory NPAT was $9.5m, including a $1.3m share of losses from the Amber investment.

• Cash increased by $17.5m to $66.7m after a $12.9m investment in Amber; no dividend declared as capital is focused on growth.

• Four new utility customers were added, including entries into Saudi Arabia and the Philippines; Veovo expanded with major contracts in the Middle East and UK.

Financial highlights

• Group revenue: $213.2m (FY23: $169.9m); Utilities revenue: $181.3m (+23%); Veovo revenue: $31.9m (+45.5%).

• Non-recurring revenues up 104% to $60m; recurring revenues up 33% to $121.3m.

• Underlying Utilities revenue growth: UK +43%, Australia +30%, NZ +85%, Rest of World +248%.

• EBITDA margin before LTI costs improved to 19% in FY24, up from 17% in FY23.

• R&D expenditure expensed: $22.7m (FY23: $21.9m); R&D tax credits of $1.7m recognized as other income.

Outlook and guidance

• Mid-term guidance targets revenue growth above 15% CAGR and EBITDA margin of 15-20% after all development costs.

• FY25 expected to see continued revenue and EBITDA growth in both Utilities and Veovo, subject to timing of business opportunities.

• LTI-related costs expected to decrease in FY25 and fall below 1% of revenue by FY26, supporting margin expansion.

• No dividend planned as capital is prioritized for growth; capital allocation to be regularly reviewed.