Credit Clear Limited Achieves Record Revenue and Strong Financial Performance in FY24
CCR (CCR) Share Update August 2024 Tuesday 27th
Credit Clear Limited Reports Record Revenue and Strong Financial Performance for FY24
Credit Clear Limited (ASX: CCR) has reported record revenue and significant financial improvements for the fiscal year ending June 30, 2024, driven by growth from existing and new clients.
Instant Summary:
- Record revenue of $42.0 million, up 20% from the prior corresponding period.
- Underlying EBITDA of $4.2 million, an improvement of $4.0 million from last year.
- FY25 guidance of $48 million - $50 million in revenue and +$7 million in Underlying EBITDA.
- Strong balance sheet with $13.1 million cash at bank, a $1.1 million improvement year-on-year.
- Expansion of tier-1 clients from 12 to 20.
- Digital collections up 63% to $116 million for FY24.
- 56% increase in files referred to the Consumer division in H2 '24 compared to H2 '23.
Financial Performance
Credit Clear Limited has delivered record revenue of $42.0 million for FY24, marking a 20% increase from the prior corresponding period (pcp). This achievement is at the top end of the company's guidance of $40 million - $42 million. The revenue growth was primarily driven by winning more share of wallet from existing tier-1 clients and the addition of new clients.
The company reported an Underlying EBITDA of $4.2 million, which is a $4.0 million improvement on pcp. The statutory EBITDA stood at $2 million, an improvement of $7 million from the previous year. Credit Clear has provided FY25 guidance, expecting to achieve $48 million - $50 million in revenue and +$7 million in Underlying EBITDA, excluding any acquisitions.
Strong Financial Position
As of June 30, 2024, Credit Clear had $13.1 million in cash at the bank, a $1.1 million improvement year-on-year. This strong balance sheet positions the company well to fund growth opportunities, including potential international market entries.
Client and Technology Developments
The number of tier-1 clients grew from 12 to 20 during the year. Payments made via the company's high-margin digital platform increased by 63% on pcp to $116 million. An experiment with a large energy provider showed a 22% uplift in performance when using the company's AI module to determine the optimal 'action type' and 'action time' for digital messages.
New Business and Market Trends
Credit Clear signed three potential tier-1 clients, 22 potential tier-2 clients, and 368 potential tier-3 clients during the year. The company is in discussions with additional potential clients across various sectors, including energy, education, water, local government, and insurance.
New Hardship Management Solution
In response to the increasing number of Australians falling behind on payments, Credit Clear introduced 'iAssist', a SaaS platform providing a digital solution for individuals facing financial hardship. This platform aims to offer a convenient and respectful experience for those in need.
CEO's Statement
Credit Clear CEO and MD, Andrew Smith, stated: 'Record revenue and a controlled cost base have helped us achieve and exceed our Underlying EBITDA guidance. Our growth overcame the seasonality of Q2 and Q3, and we saw an expected uplift in Q4 with record revenue of $11.5 million. Moving into FY25, we are well-positioned to capitalize on growth opportunities.'
The announcement of record revenue and strong financial performance is likely to positively impact Credit Clear's stock price. The company's strong balance sheet and growth in tier-1 clients indicate a robust business model. The introduction of new technologies and solutions, such as the AI module and 'iAssist', further strengthens the company's market position.
Investor Reaction:
Analysts are expected to react positively to Credit Clear's financial results, given the significant improvements in revenue and EBITDA. The company's strong balance sheet and growth prospects, including potential international market entries, are likely to boost investor confidence.
Conclusion:
Investors should consider Credit Clear's strong financial performance and growth prospects when making investment decisions. The company's continued success in winning new clients and deploying innovative technologies positions it well for future growth. Stay informed on Credit Clear's developments and market trends to make well-informed investment choices.