Fonix earnings grow faster than forecast in first half
Mobile payments and messaging provider Fonix Mobile said in a trading update on Tuesday that gross profit and adjusted EBITDA in the first half had grown ahead of management expectations.
The AIM-traded firm said that as a result, it now expected adjusted EBITDA for the year ending 30 June to be “comfortably ahead” of its forecasts.
It said gross profit in the six months ended 31 December grew 20% to £7m, while adjusted EBITDA was ahead 20% at £5.5m.
Fonix said it was continuing to generate “strong” underlying cash flows, and intended to pay an increased interim dividend in March.
Its policy remained to pay out 75% of adjusted earnings per share.
On the operational front, Fonix said the total volume of mobile payments grew 12% to £138m for the period, as it continued to attract new customers in all sectors, with 116 active customers by 31 December - an increase of 10% on the previous year.
Fonix said it remained the “leading provider” of charity telethons, including ITV's Soccer Aid, BBC Children in Need, Comic Relief and the Ruth Strauss Foundation, and had added several new clients in the period.
The company’s three business segments of payments, messaging and managed services had each grown in the first half, and the board said the business retained a “growing pipeline” of significant prospects going into the latter part of the year.
Looking ahead, Fonix said that with “high levels” of repeating revenue and client retention, expanding international reach, and a growing pipeline of client prospects across all sectors, its board was confident in the growth potential for Fonix going into the second half and beyond.
“We are delighted to have continued to deliver on our strategic goals, with growth ahead of initial expectations,” said chief executive officer Rob Weisz.
“Our key business segments have each grown strongly throughout the period and we have continued to optimise margins further, focusing on growth in more profitable product offerings.
“The business continues to make good progress on the launch of international services and hopes to announce significant developments later in the year.”
Fonix said it would report its interim results for the six months ended 31 December on 14 March.
At 1049 GMT, shares in Fonix Mobile were up 9.22% at 160p.