Iress (IRE) H2 2024 earnings summary

Executive summary

• Completed a multi-year transformation program, resulting in a leaner, more focused business with a materially strengthened balance sheet and record FY24 results ahead of guidance.

• Embedded new management disciplines, reset cost and asset base, and reinstated a final dividend of AUD 0.10 per share.

• Divested non-strategic assets, now focused on two core businesses: Trading & Global Market Data and Wealth Management, with the Superannuation business sale to Apex Group expected to complete in Q2 2025.

• Delivered material earnings growth and exceeded guidance, driven by disciplined capital allocation and operating leverage.

Financial highlights

• Adjusted EBITDA up 25.2% to AUD 132.8m; margin expanded by over 500bps to 22.0%; underlying EPS up 72.4% to 34.3c per share.

• NPATA increased 192% to AUD 30.1m; statutory NPAT swung from a AUD 137.5m loss in FY23 to an AUD 88.7m profit in FY24.

• Free cash flow up 192% to AUD 30.1m; net debt reduced by over AUD 200m, leverage ratio down to 1.0x from 2.5x.

• Revenue declined 3.4% due to asset sales, but continuing business revenue grew 4% year-over-year.

• Operating costs down 9% to AUD 471.8m, with headcount reduced by 15% to 1,500.

Outlook and guidance

• FY25 NPATA guidance: AUD 54–62m, up 80–106% from FY24; Adjusted EBITDA guidance: AUD 127–135m, up 6–12% for continuing business.

• Revenue growth expected at 4–5% for 2025, with cost growth at 3–5%, supporting further margin expansion.

• Continued investment in product innovation, data & AI, and digital advice, with a focus on cost discipline and margin expansion.

• Dividend payout ratio target set at 50–70% of NPATA.