ReadyTech (RDY) H1 2025 earnings summary

Executive summary

• Revenue grew 6.6% year-over-year to AUD 58.3 million in 1H FY25, with recurring revenue at 85.6% and strong enterprise contract wins across segments.

• Underlying EBITDA rose 4.6% to AUD 18.2 million (margin 31.2%), with underlying cash EBITDA up 10.2% to AUD 8.6 million (margin 14.7%).

• Major contract wins in Workforce Solutions (including largest deal to date), Education (first university win), and Justice segments, plus strategic acquisition of Council Wise to accelerate Local Government growth.

• Net loss after tax was AUD 18.7 million, mainly due to a non-cash impairment of AUD 19.9–20.6 million in the Government & Justice segment.

• Robust enterprise pipeline valued at AUD 37.5 million, with AUD 13.5 million in shortlisted/preferred stage opportunities expected to close in H2 FY25.

Financial highlights

• H1 FY2025 revenue: AUD 58.3 million (+6.6% YoY); recurring revenue at 85.6%.

• Underlying EBITDA: AUD 18.2 million (margin 31.2%), underlying cash EBITDA: AUD 8.6 million (margin 14.7%).

• Net revenue retention at 102%; expenses increased 7.8% YoY, reflecting investment in R&D and sales.

• Cash and cash equivalents at period end were AUD 11.3–19.3 million; net leverage ratio: 0.86x.

• Underlying NPAT at AUD 3.7 million, down 9.7% YoY; underlying NPATA at AUD 7.2 million, up 5.9%.

Outlook and guidance

• FY2025 revenue growth expected at high single digits (including government); low double digits for other segments.

• Underlying EBITDA margin (ex-LTIP) targeted at 33–34%; cash EBITDA margin at 17.5–18.5%.

• Medium-term (FY2027) revenue target: AUD 160–170 million, with mid-teens CAGR and margin expansion.

• Strong visibility for FY2026 growth, with significant tailwind from pipeline conversion and NRR improvements.