Shares in the OH&S software group are falling on Thursday
The post Damstra (ASX:DTC) share price slumps 5% despite revenue surge appeared first on The Motley Fool Australia. –
Damstra share price slumps despite revenue surge
In early trade, the Damstra share price is down more than 5% after the company provided its results for the year ended 30 June 2021 (FY21). Some of the key takeaways include:
Revenue up 40% on the prior corresponding period (pcp) to $27.4 million
Annual recurring revenue (ARR) up 63% on pcp to $34.5 million
Pro forma earnings before interest, tax, depreciation and amortisation (EBITDA) down 3% to $6.6 million
Cash receipts up 51% on pcp to $31.7 million
737,000 users, up 74% from 423,000 in FY20
What happened in FY21 for Damstra?
The Damstra share price has slumped 39% lower over the past 12 months despite a year of headline growth. One significant event was the October 2020 acquisition of Vault Intelligence Ltd (ASX: VLT) for non-cash consideration of $99.3 million.
Damstra increased its ARR, cash receipts and user numbers throughout the year. Other significant achievements for the year include global footprint expansion and new product launches.
Damstra now has 737,000 global users with its products used in more than 20 countries. The Aussie software group also announced several major contracts including with NBN Co. and a trial with a new global mining client.
What did management say?
Damstra CEO Christian Damstra had the following to say about the result:
FY21 has been a transformational year for Damstra, having strategically repositioned our product offering under the Enterprise Projection Platform (EPP) banner, while delivering strong revenue growth and EBITDA performance.
We are pleased to have successfully integrated Vault into the Damstra ecosystem following its acquisition during the year. Signficantly outperforming the targeted operational synergies from the deal has helped us to drive strong operating leverage in the business, resulting in robust EBITDA and margins in FY21.
What’s next for Damstra and its share price?
Damstra is targeting free cash flow breakeven in FY22 based on a higher revenue base and run-rated cash synergies from the Vault acquisition.
The Damstra share price has fallen in early trade, down 4.62% at the time of writing to $1.135. It is also down 25.5% year to date.
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Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Damstra Holdings Ltd. The Motley Fool Australia owns shares of and has recommended Damstra Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.