Investors should have a close look at Slide 13 of this Wilsons...

Investors should have a close look at Slide 13 of this Wilsons Advisory Presentation, examining the improving mix of revenue and the vastly higher margins on the rapidly growing New Clients / Products revenue.

In particular, the slide shows that the revenue from new SaaS clients and products has grown from 5% in FY20 to 51% YTD FY21. It also shows that the gross margin of this new SaaS revenue is 2.5x higher than the gross margin on the old type revenue from foundational clients.

The implications of this for profit growth is very significant. If I use an example of just 25% total revenue growth in FY21, then this revenue mix change and improved gross margin means that gross profit will be 108% higher in FY21, just on a 25% revenue growth rate. (Please don't interpret this as a prediction of the likely revenue growth - I am simply using a possible revenue growth rate to illustrate the impact of the above changes on gross profit growth. It is entirely possible that the actual revenue growth could be much higher than my example of 25%, in which case gross profit growth will be much higher than 108%.)

P.S. I am happy to share my analysis, but only if I get some feedback that it is useful. If not useful, don't feed back and I won't waste my time in future.