ReadyTech (ASX: RDY) expects organic revenue growth of mid-teens in FY24

4 min read | January 17, 2024 12:28 PM AEDT | By Team Kalkine Media

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ReadyTech (ASX: RDY) expects organic revenue growth of mid-teens in FY24 — Image source: © Wrightstudio | Megapixl.com

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Highlights

ReadyTech provides SaaS and software solutions in the employment and education sector

In FY23, the company witnessed a 32% YoY growth in revenue to AUD 103.31 million

Pemba Capital Partners Pty Ltd has the highest stake in the firm with a shareholding of nearly 31.32%

Software as a services (SaaS) provider, ReadyTech Holdings Limited (ASX:RDY) caters to the government, justice, workforce management, employment services, and education sectors. The company is also engaged in offering HR and payroll solutions to mid-sized companies, cloud-based student educational management systems to education providers and various products to the government and judicial fields involving compliance and asset management.

During the financial year 2023 (FY23), the company registered 32% YoY rise in revenue to AUD 103.31 million and 13.2% YoY increase in EBITDA to AUD 29.76 million. The period recorded 43.4% decline in net income to AUD 4.98 million and 11.9% YoY increase in net debt to AUD 31.49 million.

Top 10 shareholders of RDY

The top 10 shareholders of RDY have around 62.97% stake in the firm. Pemba Capital Partners Pty Ltd has the highest stake in the firm with a shareholding of nearly 31.32%, followed by Microequities Asset Management Pty Ltd. with 14.91% shareholding.

Growth opportunities

The company seeks to achieve long-term growth by entering new geographies. The company forecasts long-term success via new contract wins in profitable market segment and client upgrades.

The company has secured significant contracts with technology budget which offers the potential for attractive annual SaaS contracts in the range of AUD 500k to 5 million.

The focus is on exploring opportunities with big clients, high customer lifetime value and long-term customer retention.

Outlook

In FY24, the company expects to see mid-teens organic growth and estimates EBITDA margin in the range of 34%-35%, excluding the LTIP impact. EBITDA margin without LTIP and IT vision is expected to fall within 36% to 37% range. Moreover, the labour capitalization is anticipated to decrease as a percentage of revenue to 14% -15%.

Share performance of RDY

Shares of RDY closed at AUD 3.35 apiece on 17 January 2024. With this, RDY’s share price has dropped by 4.29% in the last 12 months, and has surged by 13.56% in the past nine months.

The 52-week high of RDY is AUD 3.84, recorded on 4 September 2023, and the 52-week low is AUD 2.8, recorded on 26 May 2023.

Note 1: Past performance is neither an Indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, and currency, is 17 January 2024. The reference data in this report has been partly sourced from EODHD/Others.

Disclaimer

This article has been prepared by Kalkine Media, echoed on the website kalkinemedia.com/au and associated pages, based on the information obtained and collated from the subscription reports prepared by Kalkine Pty. Ltd. [ABN 34 154 808 312; AFSL no. 425376] on Kalkine.com.au (and associated pages). The principal purpose of the content is to provide factual information only for educational purposes. None of the content in this article, including any news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations, and video is or is intended to be, advisory in nature. The content does not contain or imply any recommendation or opinion intended to influence your financial decisions, including but not limited to, in respect of any particular security, transaction, or investment strategy, and must not be relied upon by you as such. The content is provided without any express or implied warranties of any kind. Kalkine Media, and its related bodies corporate, agents, and employees (Kalkine Group) cannot and do not warrant the accuracy, completeness, timeliness, merchantability, or fitness for a particular purpose of the content or the website, and to the extent permitted by law, Kalkine Group hereby disclaims any and all such express or implied warranties. Kalkine Group shall NOT be held liable for any investment or trading losses you may incur by using the information shared on our website.

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