PRESS RELEASE: Comms Group announces strong FY24 earnings growth and inaugural dividend

Comms Group Limited released its financial results for the full year ended 30 June 2024.
FY24 Highlights:
• Revenue guidance exceeded for the year with total revenue of $55.5m, an increase of 7% year-on-year. The growth in revenue is all organic and over 90% of revenue is recurring.
• Underlying EBITDA within market guidance at $6.6m for the year, a significant increase of 36% year-on-year.
• The focus on cash generation and generating strong shareholder returns has seen operating cashflow increase 153% to $3.8m and free cashflow increase nearly 200% to $3.5m.
• A significant achievement was the granting of voice-licences across the Asia Pacific allowing the Group to provide services to wholesale and multi-national corporates (MNCs) in 13 countries across the Asia Pacific region.
• An inaugural dividend of 0.25c ($0.0025) per share (fully franked) has been declared.
Commenting on the FY24 results, CEO and Managing Director Mr Peter McGrath said, “We are extremely pleased with our FY24 results with solid increases in both revenue and underlying EBITDA of the business. The strong increases in both operating and free cashflow were standout results. This combined with our inaugural dividend declared of 0.25c ($0.0025) per share, fully franked, highlights our key focus on cash generation and generating strong shareholder returns. We are encouraged by the positive results and continued opportunities of each of our three operating businesses. All three business units are showing an increase in underlying EBITDA year-on-year.”
Customers, sales and growth initiatives
We have changed our divisional names to provide a more accurate reflection of what these businesses do. Our Global business is now known as Global UCaaS and Wholesale, our domestic SME Telco business is now known as Cloud Communications and Collaboration and our ICT business is now known as Secure Modern Workplace Solutions.
All three business units continue to have a healthy sales pipeline of quality sales deals.
Our Global UCaaS and Wholesale business has added significant capability across the Asia Pacific region allowing us to service more Tier 1 carriers, MNCs, large OTTs (over the top) providers and CPaaS and CCaaS customers with the great products and excellent service levels, for which we are known for in the marketplace.
In FY24, we expanded our international reach including with telco licences, particularly in the Asia Pacific region. We now have local voice licences in place in Australia, NZ, Singapore, Hong Kong, Indonesia, Japan, Malaysia, Philippines and Taiwan (in progress) and local partnerships in China, South Korea, Thailand and Vietnam.
The business has continued to expand its relationship with strategic accounts including Vodafone. We have a total of six strategic accounts where these strategic accounts use our services for their own customers and typically bill more than $100k pcm (or are expected to reach this figure over time). We expect to grow the number of strategic accounts over time.
Our key partnership with Vodafone Group continues to have a positive trajectory. We continued to grow our business with Vodafone in FY24 and expect further growth in FY25. We also expect to close some key deals in the near term.
Strategy
We see growth opportunities in all of our business areas. Domestically we are focussing on the corporate mid-market sector and see opportunities to cross-sell our secure modern workplace solutions to our wider customer base of circa 5,000 customers.
We are working to expand our partner program, strategic alliances and channels to market in Australia and the Asia Pacific region.
Our footprint and licence expansion in the Asia Pacific is opening up opportunities with other wholesale customers. We intend to leverage this significant Asia Pacific footprint to provide unified communications, collaboration and secure modern workplace solutions to MNCs operating across the region.
We are working on a digital transformation program to implement common Group wide processes and systems with the goal of moving to a common platform and a single brand over time.
We also have a key focus on cash generation and generating strong shareholder returns, with a goal of increasing operating and free cash flow generation over time.
We will explore strategic growth opportunities where appropriate in order to increase scale and add additional capabilities.