Veris (VRS) H2 2024 earnings summary

Executive summary

• Achieved $92.6m in FY24 revenue, reflecting a strategic pivot to higher-margin digital and spatial consulting services and operational restructuring to address market softness and resourcing constraints in Queensland.

• Digital & Spatial segment revenue share increased to 17% in FY24, up from 11% in FY23, with significant growth in high-value projects and a 12% year-over-year increase in average project value.

• Implemented cost and headcount reductions, resulting in $3.6m annualized labor cost savings, $3.0m+ in one-off restructuring costs, and a reduction in headcount by approximately 100.

• Shifted to a national operating model to improve efficiency and support digital strategy.

Financial highlights

• Revenue declined to $92.6m from $100.9m in FY23, mainly due to transition away from legacy small projects and market softness.

• Gross profit margin improved to 32.6% from 31.4% in FY23, driven by selective project choices and higher-value digital services.

• EBITDA was $6.7m (7.2% margin), down from $10.2m (10.1% margin) in FY23.

• Underlying PBT was a loss of $1.8m, compared to a $1.0m profit in FY23; statutory loss after tax was $4.7m.

• Cash at hand was $16.1m as of June 30, 2024, compared to $17.3m a year earlier.

Outlook and guidance

• Secured forward workload exceeds $60m for the next 12 months, with an additional unsecured project pipeline valued at over $190m.

• Positioned to capitalize on digital transformation trends and commercialize new digital and spatial solutions.

• Early FY25 performance shows strong financial results from restructuring and operational initiatives.

• Ongoing shift to high-margin, specialist work may reduce short-term revenue but is expected to improve margins and profitability.