Growth in AU/NZ market to be unlocked under simplified business: Novatti
ASX-listed Novatti Group have provided an update on its September quarter FY24 performance, with quarterly sales revenue up 6% on the quarter to $10.8 million, and a $1.2 million decrease in expenses.
Commenting on the results, Novatti CEO, Mark Healy (pictured), said, “Novatti used Q1 of FY24 to continue the implementation of its new strategy, simplifying the business with a focus on building an integrated payments proposition and enhancing gross margins. For the September quarter, this included creating an integrated AU/NZ core payments division, with Novatti’s clients now able to access multiple products and services from the one provider, increasing cross selling opportunities. This restructure and the supporting adjusted operating model will drive increasing product margins, which have already increased for this division to 45%, up from 40% in the prior quarter.
“Novatti’s new strategy is also seeing positive impacts elsewhere across the business. Quarterly revenue continued positive growth, increasing to $10.8 million. Further, operating expenses, excluding IBoA, decreased by $1.2 million to now represent 74% of revenue instead of 90% in the prior quarter.
“With the first phase of Novatti’s simplification strategy in place, we have now begun a Group wide business review to ensure all business activities align to long term strategic and financial goals. This process is expected to result in further opportunities to streamline the business through portfolio optimisation and divestment. Completing this review will be a priority in the coming quarters, which we ultimately expect to promote ongoing improvements in our financial results.
“We continued to see broader growth in demand across the economy for the services that Novatti provides. While there is talk of uncertainty in the global economy across coming quarters, we believe this presents an opportunity for businesses to unlock efficiencies through digital payments and a consolidated provider, with Novatti being well placed to provide multiple products to customers.”
As of 30 September 2023, Novatti Group had $14.7 million cash on hand.
Disclosure: At the time of writing, Australian FinTech Pty Ltd is a shareholder of Novatti Group Limited.
