Netcall (NET) H2 2024 earnings summary

Executive summary

• Achieved strong performance with high demand for cloud solutions and significant progress in embedding generative AI into products.

• Expanded market share in key sectors: healthcare, public sector, and financial services, with 82% of revenue from recurring sources.

• Maintained healthy profitability, excellent free cash flow, and a net cash balance of GBP 34 million before post-year-end acquisitions.

• Employee engagement score of 83% and high customer satisfaction, with over 90% of customers willing to recommend.

Financial highlights

• Revenue increased 9% year-over-year to GBP 39.1 million; adjusted EBITDA slightly ahead of expectations at GBP 8.4 million.

• Subscription revenue up 19% to GBP 19.8 million; cloud subscriptions now 90% of new sales.

• Free cash flow of GBP 12 million (31% of revenue); net cash GBP 34 million.

• Adjusted EPS up 7% year-over-year to 3.57 pence per share.

• Recurring revenues represent 82% of total revenue, up three percentage points from FY 2023.

Outlook and guidance

• Board confident in meeting expectations for the new financial year, supported by growing contract revenues and a healthy pipeline.

• Continued investment in innovation and product enhancements to drive future growth.