Organic Growth:Here is some simple math for those that are not strong in this area:
- IWS acquistion was announced on 31/3/21 so logically is included in any annualised revenue figures from that date onwards
- FY21 ARR was 27.2m (see announcement 31/5/21) and includes IWS annual revenue
- 27.2m x 36% = 37m
So we clearly have 36% organic revenue growth (well technically 36.99%). Organic revenue was my biggest concern about the company and now we can through that concern out the window. So now we not only have positive EBITDA, but we now also have good organic revenue.
Competition & Market Share:For those who believe that competition in this market is high, you are 100% correct. But this is a lazy comment with no analysis. Can you explain to me why large and succesfull companies such as ASICS, Subway, Zambrero, Pizza Hut, Electrolux, and Westpac are all Paygroup clients? Maybe its because they provide a good service which will allow them to attract new clients and gain a decent market share???
Lets not forget this is a pretty big market:
"Global Industry Analysts (GIA) Predicts the World Cloud-based Payroll Software Market to Reach $10.7 Billion by 2026"
Summary:Next on the to do list is positive NPAT. Due to the last acquisition (IWS Australia), we will not see this in FY22. But once we get a full year of no acquisitions in FY23 we will hopefully be able to check this off the to do list.
If you are here for the long term then I look forward to joining you for the ride. If you are here for a quick 1 month profit then I would suggest looking for a mining exploration company instead.
