Pushpay Holdings [ASX:PPH] Tightens FY23 Guidance

The church payments and charity donations system Pushpay Holdings [ASX:PPH] has said that it will be narrowing its initial guidance range, having found that its performance for December/January lined up with expectations.

Pushpay revealed that underlying EBITDA, coupled with some fair value adjustments, is now expected to reach US$55–57 million by the end of the financial year.

This has shifted from the previously reported range of US$54–58 million.

The company also reported expectations of positive operating revenue growth, outlining growth in the range of 5–6% for the 2023 financial year.

PPH’s shares were tallied around $1.19 by Tuesday afternoon, with the church and charity financial group moving its share price value up by 15% in the last full year.

Source: tradingview.com

Pushpay outlines first half trade and changes FY23 guidance

At the end of 2022, the church and charity donations platform gave a preview of its results for the first six months of the financial year that ended September 2022, detailing the completion of its new, large customers in the ongoing build of the catholic segment.

Net new customer growth had been slower on the company’s go-to-market reset that was completed at the end of 2022, though this has affected the company’s revenue and processing volume growth.

Despite slower growth rates in the first half of 2023, it found encouraging signs from its operational work.

In its interim October group report, PPH provided unaudited preliminary results that showed operating revenue totalled US$103.0 million, up 10% on the prior comparable period (pcp).

Underlying EBITDAF was US$26.8 million, down 10% on pcp. Total processing volume increased to US$3.6 billion, up 2% on pcp. Growth in processing volumes was affected by the softer net new customer growth in 1H23.

Strong operating cash flow resulted in net debt of US$35.1 million, down from US$47.2 million in March ‘22.

Despite lowering expectations to 4–8% for FY23 positive operating revenue growth back in October, the company has again adjusted between 5% and 6% for FY23.

Following the completion of month-end processes, Pushpay advised trading performance for December and January was in line with its expectations and narrowed its guidance range for Underlying EBITDAF to be between US$55 million and US$57 million.

Pushpay commented:
‘The Company’s strong operating cash flow continues to enable Pushpay to pay down its debt facility, which was obtained to partially fund the Resi Media acquisition in August 2021. Pushpay’s net debt balance has reduced from US$35.1 million as at 30 September 2022, to US$22.2 million as of 31 January 2023.’

‘The Company’s strong operating cash flow continues to enable Pushpay to pay down its debt facility, which was obtained to partially fund the Resi Media acquisition in August 2021. Pushpay’s net debt balance has reduced from US$35.1 million as at 30 September 2022, to US$22.2 million as of 31 January 2023.’

Previously PPH said that FY23 represents a year of investments with the company working towards building the foundation for future growth and ticking milestones off along its strategic plan, a sentiment echoed today in reconfirming and narrowing its guidance range.

Regards,

Mahlia Stewart,

For Money Morning

Original post dat 07/02/23. All advice is general in nature and has not taken into account your personal circumstances. Please seek independent financial advice regarding your own situation, or if in doubt about the suitability of an investment. Any actual or potential gains in these reports may not include taxes, brokerage commissions, or associated fees.