Gentrack returns to profit as revenues surge by a third

Gentrack returns to profit as revenues surge by a third

UK customer insolvencies prompt a flat growth forecast for 2024.

Gary Miles (Gentrack)

Gary Miles (Gentrack)

Credit: Supplied

Revenue at utilities software developer Gentrack surged 34.5 per cent in the year to 30 September to reach $169.9 million.

EBITDA performance was even strong at $23.2 million, $15.1 million higher than in 2022.

However, the insolvency of key UK customers has led Gentrack to forecast relatively flat results in 2024.

"Bulb and other UK insolvencies represented $27.6 million of 2023 revenue and we do not expect further revenue from these customers in 2024," Gentrack told shareholders today.

"We believe that the historical occurrence of supplier insolvencies in the UK B2C energy sector is no longer a material threat to our customer base as many of the weaker players have exited and the UK regulator has instituted a more business friendly regulatory approach."

Despite those headwinds, Gentrack upgrade its revenue guidance for 2024 to be in line with 2023.

"The strong underlying growth in both utilities and Veovo means we are able to upgrade our revenue guidance for 2024, from the prior guidance of being between $157 million to $160 million to being at least in line with 2023 revenue at [around] $170 million despite the loss of ‘one off’ revenues of $27.6 million from insolvent UK customers," CEO Gary Miles told investors.

2024 EBITDA was expected to be between $20.5 million and $25.5 million.

Strong revenue in 2023 was driven by a 36.7 per cent increase in the utilities business to $147.9 million for the year. Uderlying growth in that business excluding insolvencies was up by 47 per cent over 2022.

Veovo airports also grew strongly, with revenue up 21.3 per cent to $21.9 million with growth in both recurring revenues, up 15.8 per cent, and non-recurring revenues, up 32.9 per cent.

2023 also marked a return to after tax profit, $10 million, against a loss in the prior year.

Last week, local energy giant Genesis announced Gentrack's software along with Salesforce would be the backbone of its digital transformation.

EnergyAustralia went live with Gentrack in March, launching its innovative "Solar Home Bundle" on the company's distributed energy management solution. 

In New Zealand, the company also completed the migration of Mercury Energy's business to consumer business from SAP after Mercury's 2022 acquisition of Trustpower.

Gentrack is now aiming plan to expand its international footprint beyond its core markets of the UK, Australia, and New Zealand.

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