ASX-listed payments leader Novatti’s half yearly revenue exceeds $26 million

ASX-listed payments leader Novatti Group have announced their half yearly results with revenue reaching $26.2 million, up 22.3% year on year (YoY)

Novatti have announced that they remain on track to achieve positive operating cashflow for the half-year ending June 2025. The company also has $6.25 million in cash at end of H1 FY25.

Commenting on the company’s H1 FY25 performance, Novatti CEO Mark Healy said, “At this time last year, I reported to you that the positive results from our turnaround strategy were just emerging. Fast forward 12 months, and I am now pleased to report to you that the positive results from our turnaround strategy are clear and embedded, as highlighted in Novatti’s H1 FY25 results.

“To start with, revenue increased 22.3% YoY in H1 FY25, despite our intense focus on reducing costs. Notably here, revenue and activity is increasing in the areas considered core moving forward, particularly Payments AU/NZ, which increased gross transaction value by 38% YoY (excluding cross border payments).

“The contribution being derived from this increasing revenue is also increasing, following the review across H1 FY25 to exit low profitability services, solutions and customers. This review helped contribute to Q2 FY25 Payments AU/NZ gross margin increasing to 49%, an increase of 15% YoY, on our way to achieving our three-year 70% target. Notably here, further gains are expected across CY25 in particular.

“A clear focus across H1 FY25 was our substantial cost out program, which has now been fully implemented. While the full results of that program won’t be seen until Q3 FY25, the impact is already clear as opex in H1 FY25 fell 29% YoY.

“When combined, the embedding of Novatti’s turnaround strategy saw a 97% improvement YoY in H1 EBITDA, to ($0.36 million). While this turnaround is significant, the job is not finished and our absolute focus in the short term remains on achieving our positive operating cashflow goals, which remain on track for H2 FY25.

“At the same time, we are now positioning Novatti for growth on the other side of these targets. We consider that the Payments AU/NZ business will provide the core growth platform moving forward and, to this end, we will use the remainder of FY25 in particular to execute on our existing pipeline for this business. At the conclusion of H1 nearly 40% of the 500 merchant pipeline identified at the beginning of H1 FY25 had completed onboarding. We particularly expect this process to benefit from our February brand refresh to better reflect Novatti’s strength as a single payments solutions provider for Australian and New Zealand businesses.

“Having made significant structural changes to the business since the beginning of FY24, and having embedded our turnaround across H1 FY25, we remain incredibly positive about the prospects of the business and its growth moving forward. Achieving positive operating cashflow will be the next milestone in this turnaround journey,” Healy ended.

Disclosure: At the time of writing, Australian FinTech Pty Ltd is a shareholder of Novatti Group Limited.