Straker's FY24 Financial Results Overview

Straker Ltd (ASX: $STG) has reported a solid FY24 financial result, with a record revenue of $50m and cash receipts slightly higher at $52.2m. The company achieved a third consecutive year of positive and improved year-on-year adjusted EBITDA, with a gross margin of 63.8% and adjusted EBITDA of $4.5m, triple the amount delivered in the prior corresponding period. Straker also generated free cash flow of $2.3m, showing a $3.2m improvement versus the prior corresponding period. The company maintains a strong balance sheet with no debt and cash of $12.2m, net of the impact of the share buyback completed in the period. In FY25, Straker expects gross margin above FY24 levels, continued positive EBITDA, and free cash flow generation, with the new AI app product suite, 'Al Cloud', contributing to the company's annual recurring revenue base.

Grant Straker, Co-Founder and CEO, on FY24 Results and Outlook

As a management team, we are immensely proud of the step change in the profitability of Straker, as demonstrated by this set of results. We dramatically expanded margins, continued to be EBITDA positive, generated cash, bought back 5% of the Company, and maintained enviable balance sheet strength. On the revenue side, conditions were tougher than expected, particularly as clients moderated the tempo of their commercial engagement with technology suppliers as they assessed the implications of generative AI. We embrace generative AI wholeheartedly, and leveraging this technology has been a core element of our product development strategy to support future top-line growth, exemplified by the recent launch of our Verify product. Early indications from customers regarding AI Verify are extremely encouraging. We are pleased to provide the market guidance on a number of key metrics for FY25, and we believe that the work we have done on the business in the last two years has set it up extraordinarily well for a return to more exuberant market conditions and burgeoning customer demand for product offerings that leverage the tremendous benefits of generative AI.

FY24 Results Summary and Outlook

Straker Ltd (ASX: $STG) has delivered a solid FY24 financial result, marked by record profitability and positive free cash flow despite market cyclicality. The company's revenue reached $50m, with cash receipts slightly higher at $52.2m, and achieved a third consecutive year of positive and improved year-on-year adjusted EBITDA. Straker's strong balance sheet with no debt and cash of $12.2m, net of the impact of the share buyback completed in the period, provides flexibility to respond to opportunities as they arise. Looking ahead, Straker expects to return to topline growth in FY25, maintain mid-60% gross margin, continue to be adjusted EBITDA positive, and generate free cash flow. The company's new AI app product suite, 'Al Cloud', is anticipated to contribute to its annual recurring revenue base, supporting its ambitions to move more revenue from 'Repeat' to 'Recurring' and further capitalize on the benefits of generative AI.