Technology business Gentrack (ASX: GTK) has reported its result for the year to 30 September 2019.
Gentrack provides billing and other types of software for essential service organisations such as energy businesses, water utilities and airports. It has offices in New Zealand, Australia, the UK, Singapore, USA and Europe. It provides services for over 220 utility and airport sites in more than 30 countries. One of its main customers is Sydney Airport Holdings Ltd (ASX: SYD).
Gentrack’s FY19 Result
Gentrack reported that revenue grew by 7% to $111.7 million (all amounts stated are in New Zealand dollars). Recurring revenue increased by 22% to $78.2 million.
The company said there has been a continued transition to software as a service (‘SaaS’) on all new utilities business and now recurring revenue accounts for 70% of total revenue. Non-recurring revenue from project services and licences falling 24%.
Despite the ongoing Brexit issues, Gentrack reported that the UK business achieved 36% revenue growth with four new energy energy customers, a water utility customer and three new Evolve Projects.
However, debt provisions of $2.4 million mainly relating to UK utilities customers (and investing in people and R&D) caused underlying EBITDA to fall 20% to $24.8 million (click here to learn what EBITDA means).
Net profit dropped to a $3.3 million loss after a $14.6 impairment of CA+ intangibles and goodwill. However, adjusted net profit still fell by 31% to $9.6 million – which excludes accounting charges relating to the impairment.
The Gentrack Board has decided to pay a final dividend of 3 cents per share, bringing the full year dividend to 8 cents per share. This was a 42% decrease compared to FY18.
Gentrack’s airport business, Veovo, added Mexico City, Luton and Buenos Aires as new customers in FY19. It also deployed its largest ever airports solution at Orlando.
The company has also achieved a leading market position in the UK energy market with 6.3 million meters billed using its solution.
However, with continuing uncertainty in the core UK market, Gentrack is expecting the FY20 result to be in line with FY19.
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At the time of publishing, Jaz does not have a financial interest in any of the companies mentioned.