Novatti hits positive cash EBITDA with record quarterly revenue over $13 million

ASX-listed Novatti Group Limited have released its March 2025 quarter results, with the two key highlights being the company’s positive cash EBITDA and a record quarter of revenue of $13.4 million.

Commenting on the company’s Q3 FY25 performance, Novatti CEO, Mark Healy (pictured), said, “Q3 FY25 marked the next significant milestone in Novatti’s turnaround, by delivering quarterly positive normalised cash EBITDA. Reaching this milestone is the result of executing the turnaround strategy that was implemented at the start of FY24 and reinforces our commitment to doing what we say we will do.

“At the same time, the business overall continues to grow, with Q3 FY25 seeing Novatti’s strongest ever quarter of revenue at $13.4 million, an increase of more than 18% YoY. It is important to reiterate that across this same YoY period, quarterly operational expenses also fell 30%, highlighting the now clearly diverging paths between increasing revenue and decreasing costs.

“The bottom line contribution from this revenue is also increasing, as margins in our core Payments AU/NZ business improved 6% on the prior quarter to reach 52%, the strongest ever quarterly result, and again highlighting the positive impacts of our year-long restructuring program. While this latest result presents a record, we believe there is plenty of room to grow here and remain committed to achieving our longer term, 70%+ gross margin target.

“This increase in margins also contributed to net operating cash use decreasing by a significant $1.4m for the quarter to $2.2m, while noting that this figure is still impacted by the ongoing removal of legacy liabilities, as we strengthen Novatti’s balance sheet moving forward and pivot back to growth. On a normalised basis, the Company recorded positive cash EBITDA in Q3 FY25 of $100k and is aiming to remain positive in Q4 FY25.

“This pivot back to growth will be supported by the launch and go-live of Novatti’s brand refresh during the quarter, which is repositioned directly to our AU/NZ value proposition, reinforced by our market-led focus to ultimately create stronger commercial traction. This refresh is already having the desired effect, producing positive customer and market feedback through clarity of our position and offering, and resulting in new sources of inbound leads, particularly in high margin services such as card issuing.

“A second benefit of Novatti’s brand refresh is that it provides our team with a much stronger value proposition to chase larger commercial opportunities. This was a key focus for the March quarter, as we build on the significant commercial wins secured in recent quarters, including a tier one Australian telecommunications company renewing a multi-year service agreement and the contract to enhance the voucher payment offering for a major Asia-based global airline. These types of opportunities are increasingly of the size and scale that Novatti can target, backed by its strong integrated service offering.

“Again, achieving positive normalised cash EBITDA represents another significant milestone in the delivery of Novatti’s turnaround. Above all else, it highlights our commitment to doing what we say we will do. In the quarters ahead, there is more work to be done in streamlining the business however, the results from Q3 FY25 highlight systematic strategy execution and continued progress in improving Novatti’s financial performance, which will only be further strengthened as we increase our focus on growth.”

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