Araxi (AXX) H2 2024 earnings summary

Executive summary

• Achieved record revenue exceeding ZAR 1.1 billion, up 19% year-over-year, with strong growth in both payments and software divisions.

• Cash from operations increased 75% year-over-year, supporting a 21% rise in dividends per share and maintaining a debt-free balance sheet with ZAR 467 million in cash at year-end.

• Integrated Dariel acquisition and exited GovChat business rescue, strengthening operational capabilities and investing in future revenue streams.

• Focused on innovation, international expansion, and annuity-based revenue streams for predictable growth.

• R123 million invested in growth initiatives, including software development and strategic investments.

Financial highlights

• Revenue increased 19% to ZAR 1.2 billion compared to the prior year.

• EBITDA up 53% to ZAR 252.8 million, with margin improvement to 21.4%.

• Headline earnings per share rose 83% to 13.61 cents (11% excluding prior year GovChat ECL impact).

• Dividend for the year increased 21% to ZAR 0.10 per share.

• Net asset value per share up 4% to ZAR 1.257; cash and cash equivalents at year-end ZAR 467.4 million.

Outlook and guidance

• Strong project pipeline and significant orders already placed for FY 2025, especially in payments.

• Broad range of organic and acquisitive growth opportunities identified.

• Anticipates continued growth in annuity revenue and international expansion.

• Remedial actions in software division expected to improve profitability in the coming year.

• Economic climate remains a consideration, but management is confident in delivering on growth strategy.