TASK turnaround profitable, page-107

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Eqz

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10/03/24

12:55

Post #: 72831455
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Originally posted by bigbillbrown: ↑

I don't agree that you can extrapolate those historical numbers Eqz. As per your attachment, the 57% growth in recurring revenue was caused by 71% growth at Plexure and that was in turn due to a full 6 months of the reprised McDonalds contract (from memory, I think there was 2mths of the new contract in the comparable half). I do think Plexure growth could be good though. Looking back at the Q3 numbers, they said they had a record quarter which is pretty good with the comparable Dec quarter also a record due to the football world cup campaign. In fact they say transaction customers up 60% and transaction up 73% on that quarter. Also, say that costs to service are actually down YOY due to tech improvements. I think Plexure growth could be a positive surprise in FY24 numbers, not sure the market has understood how bullish that quarterly update was.

For me, Plexure is not expected to be the growth engine, the real value driver is Task. I mean they paid A$121m for that back in Aug 21 with Revenue of $14m, "pro forma" EBITDA of $2.4m. AMRR at March 22 was $6.4m. So really paying for growth potential. And it has grown but not dramatically, AMRR at March 23 was $8.8m (I can't see the Dec 23 number). Revenue for FY23 was $17.1m and it actually dropped with fall in non-recurring revenue at the interim FY24. Still, it looks like it could be about to take off. The controversial RFG pizza contract was supposed to add 10% to ARR, so about $800k. That should arrive shortly. They are saying they are getting traction in the US. 5 customers added in the last quarter. They only started off with 50. I think this part of the group is very promising, being the part that should be valued on an ARR multiple.

So now waiting for full year numbers, with no guidance given. Does anyone have an idea what the adjusted EBITDA/Operating Profit may be? The one analyst report I've seen has it up from $11.9m to $14.1m. I think that could be very light with the strong transactions in the December quarter. It factors in little growth given EBITDA in the first half was already up $1.4m YOY.

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Good analysis mate, and you are correct we can't use that historical % - it was an exaggeration.

Everything else you said rings true, I think we are going to see a very positive growth rate.

TSK Price at posting: 40.0¢ Sentiment: Buy Disclosure: Held
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1 Great analysis

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