Comms Group's FY24 results: revenue up 7%, EBITDA rises 36%

Comms Group Limited has unveiled its financial results for the year ended 30 June 2024, reporting substantial growth across multiple metrics.

Total revenue for FY24 reached AUD $55.5 million, marking a 7% increase compared to the previous year. The company's revenue growth is entirely organic, with over 90% of it being recurring.

The company also reported a significant rise in its underlying EBITDA, which stood at AUD $6.6 million, reflecting a 36% year-on-year increase. There was also a notable rise in operating cash flow, which rocketed by 153% to AUD $3.8 million. Free cash flow similarly saw a dramatic increase of nearly 200%, reaching AUD $3.5 million.

Comms Group secured voice-licences across the Asia Pacific, an achievement that broadens their service provision capabilities to wholesale and multi-national corporations in thirteen countries within the region. In addition, the company declared its first-ever dividend of AUD $0.0025 per share, fully franked.

Peter McGrath, CEO and Managing Director, expressed his satisfaction with the FY24 results. "We are extremely pleased with our FY24 results, with solid increases in both revenue and underlying EBITDA," McGrath said. "The strong increases in both operating and free cash flow were standout results. This, combined with our inaugural dividend, highlights our key focus on cash generation and generating strong shareholder returns."

McGrath also spoke positively about the prospects for each of the company's three operating businesses, which have all shown year-on-year increases in underlying EBITDA. "We are encouraged by the positive results and continued opportunities of each of our three operating businesses," he added.

The company's Global UCaaS and Wholesale business has particularly benefited from the expansion within the Asia Pacific region. Comms Group now holds local voice licences in multiple countries including Australia, New Zealand, Singapore, Hong Kong, Indonesia, Japan, Malaysia, and the Philippines, with Taiwan expected to join soon. Partnerships have also been established in China, South Korea, Thailand, and Vietnam.

McGrath outlined the nature of strategic accounts, noting that the company has relationships with six strategic accounts, including Vodafone. These accounts typically bill more than AUD $100,000 per month, or are expected to reach this figure 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," he explained.

The company's strategy is set on capitalising on growth opportunities across its business areas. Domestically, Comms Group is focused on the corporate mid-market sector and plans to cross-sell secure modern workplace solutions to its existing customer base of approximately 5,000 customers. Efforts are also underway to expand the partner programme, strategic alliances, and market channels in Australia and the broader Asia Pacific region.

Comms Group will further leverage its expanded footprint in the Asia Pacific to offer unified communications, collaboration, and secure modern workplace solutions to multinational corporations. McGrath highlighted the company's continued commitment to cash generation and enhancing shareholder returns, with a specific emphasis on increasing operating and free cash flow over time.

The company remains open to strategic growth opportunities that could enhance its scale and capabilities. "We will explore strategic growth opportunities where appropriate in order to increase scale and add additional capabilities," McGrath said.