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A leader in sports science research and innovation, Catapult Group International Limited (ASX: CAT) has announced its 1HFY19 results ending 31 December 2018. These audited results are consistent with the preliminary results released last month on 30 January 2019. The first half results are strong with company delivering continued high subscription growth, high margins and low churn.
Group results
- ARR $57.4m (+25%) driven by Elite wearable ARR +32%.
- Revenue +32% to $43m.
- Operating expenses +8%.
- 73% improvement in EBITDA to a $1.4m loss.
- Free cash flow of negative $1.6m which includes funding Prosumer start-up and growth initiatives in the core elite business.
High Growth Core
- Growth from EW +38% and EV +22%.
- Core business is EBITDA and cash flow positive.
- UEBITDA^ $3.6m, an improvement of $3.5m
- Free cash flow $4.0m
- Strong revenue growth across all regions with Australia +22%, APAC +42%, EMEA +47%, Nth America +25%.
Business Performance:
CAT is the leading provider of a full performance technology stack to the elite sport which remains its core strategic priority. Although this strategy is in the early stages of execution, the number of organisations with all three Catapult products (wearables, video, and AMS) is growing.
The growing global scale of the core elite business is reflected by a client base comprising more than 2,100 organisations (up ~300 since June 2018) and 2,500 teams across 137 countries and 21 sports. Notable signings and expansions included the French Football Federation, Real Madrid CF, NHL, Argentinos Juniors, Chelsea FC, Milwaukee Bucks, San Antonio Spurs, Confédération Africaine de Football (CAF) and the Alliance of American Football.
Performance for elite wearables:
- ARR growth +32% to $27.6m.
- Revenue growth +38% to $19.6m including sales of Playertek+ and churned with 3.5% of elite wearables subscription units not renewed, down from 8.4% a year ago.
- The subscription installed base increased 17% from Dec. 2017 to 18,293 units.
- ARPU increased to $116 per month per unit ($114 CC), up from $106 a year ago.
- The subscription to capital ratio of EW units (excl. Playertek+) was 58:42 on sales of 3,179 units. Including Playertek+, which has predominantly capital sales, the ratio was 34:66 on sales of 5,498 units.
Higher capital revenue contribution was impacted by $1.4m increase in Prosumer sales. Total opex was 8% down from 26% on pro forma basis in H1FY18. There was a Positive EBITDA Contribution from Elite Wearables and Elite Video. The core underlying EBITDA stood at $3.6m entirely attributable to H1FY19 (an increase of $3.5m H1FY18) and new products revenue $2.7m comprises of PLAYERTEK and PLAYR.
Group cash receipts from customers were up 22% to $55.5m. Group negative free cash flow was $1.6m and core underlying free cash flow was $4.0m. The stronger balance sheet provided a platform for growth. Trade and other receivables balance was down 31% from FY18.
Financial Results:
The revenue from ordinary activities was noted at $42,986K as of December 31, 2018, compared to $32,444K (December 31, 2017). The comprehensive loss from ordinary activities after tax attributable to members was noted at $5,131K as of December 31, 2018, compared to $14,328K (December 31, 2017). The Loss from ordinary activities after tax attributable to members was noted at $9,253K as of December 31, 2018, compared to $14,092K (December 31, 2017). The net tangible asset per security was recorded at 11.4 cents as at December 31, 2018, compared to 4.2 cents (December 2017).
FY19 Guidance
Catapultâs first-half growth rates for the elite core business exceeded guidance growth rates and reaffirmed FY19 guidance. Elite Core Revenue stood at $73.4m (FY18 base). The underlying Core EBITDA stood at $8.0m (FY18 base). Annualised recurring revenue (ARR) stood at $53.4m (FY18 base), the growth was above 20%. $5.3m had been invested in R&D and Next generation EW product, VECTOR, is coming soon.
The stock of the company is currently trading at A$0.710 (as at 21 February 2019, 3:21 PM AEST), up by 14.516%.
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