Gentrack booked a net loss of $3.3m for the year to September 30 against its $3.2m profit in 2021.
Ebitda fell 43 per cent to $4.6m. Gentrack said the fall was down to a “one-off” increase in R&D spending, plus adding sales staff. The R&D money went to the development and launch of the second generation of “Trilogy” technology stack created with partners AWS and Salesforce. The trio’s alliance is aimed at rivals SAP and Oracle.
Revenue was up 19.5 per cent to $126m.3m. Within that Gentrack’s utilities business’ revenue increased 21.6 per cent to $108m. Without involvencies, growth would have been 24.3 per cent, Gentrack said. Its airports business, Veovo, saw its revenue increase 7.9 per cent to $18.1m.
The UK was Gentrack’s biggest market in FY2022, accounting for $66.9m in revenue (from $54m in FY2021), followed by Australia on $32.5m (from $25.4m) and its combined New Zealand and Singapore business, which came in at $8.8m (from $8.3m).
No ebitda guidance was given for FY2024.
No dividend was paid, and no dividend guidance was given for FY2023. Cash was up $1.4m to $27.4m.
“The aviation sector is now seeing passenger numbers and travel demand returning,” Gentrack said in a statement.
“We see signs that this recovery will result in new business as airports seek to invest in ways to improve efficiency and service and catch up with pent-up IT demand for modernisation.”
The firm is picking 15 per cent compound annual growth for its airports business over the next five years, with ebitda within a 15 to 20 per cent range of revenue.
On the utilities side, the firm said: “Both water and energy are essential services which should be less impacted in the event of a global economic downturn.”
Changes in Britain forced firms to pass on subsidies to customers and triggered the collapse of a number of companies.
This morning, Gentrack said the roil was largely behind it.
“The UK government has taken corrective action to stabilise the UK B2C (business-to-consumer) energy market. We have not seen any further customer insolvencies since December 2021, and we expect this market stabilisation will continue.”
CFO John Priggen said the Bulb Energy and other UK insolvencies would see revenue loss of $13m, spread evenly over FY2023 and FY2024, but that the insolvencies will be “behind us” from FY2025. “Better quality, larger tier customers” were left standing, Priggen said.
The $13m in exits was balanced by customer wins from “transformations and resets”, including Mercury moving from SAP to Gentrack that were expected to increase recurring revenues by $16m.
Gentrack is targetting ebitida from its utilities business to reach 12-17 per cent of revenue in FY2024 and 15-20 per cent from FY2025.
The firm’s customers include Auckland Airport and Mercury in New Zealand, Sydney and Melbourne airports, Gatwick, Edinburgh and Birmingham airports in the UK and energy companies So and Engie in the UK.
On a conference call with analysts, chief executive Gary Miles said an extra $3m per year would be spent on sales and marketing as Gentrack looked to grow beyond NZ, Singapore, Australia and the UK and “go global”. A Singapore office would be opened as a launchpad into Asia.
“I’m feeling very bullish on water,” Miles said on the conference call.
The CEO said Gartner research had found that utility providers had to shed about 25 per cent of their “legacy” meters, representing around 400m meter points, or around $1 billion in annual recurring revenue.
In FY2023, Gentrack would enter the regulated UK water market and expand its water business in Australia.
