Fonix Mobile reports robust set of full-year results

Fonix Mobile announced a robust set of full-year financial results on Thursday, with a 3.7% rise in total payment volume to £268.1m.

The AIM-traded firm recorded a 21% increase in revenue to £64.92m for the 12 months ended 30 June, with a 13.9% boost in gross profit to £15.08m.

Adjusted EBITDA, profit before tax and earnings per share improved by 12.7%, 13.5%, and 9.9%, respectively, while underlying cash surged 21.3% to £9.45m.

Fonix proposed a final dividend increase of 8.7% to 4.89p.

From an operational perspective, Fonix emphasised its impressive 13.9% growth in gross profits, which it said was primarily fuelled by international expansion and second-half growth within the UK.

Furthermore, the total payment volume from mobile payments grew, with commercial client payments registering double-digit growth.

However, that increase was partially offset by a decline in charity-related total payment volume, which tends to be less related to gross profit performance.

Both the payments and messaging segments, identified as Fonix's primary business branches, saw profitability increases of at least 15%.

The board said that significant business accomplishments in the latter half of the year hinted at a promising outlook for the upcoming year.

Notably, Fonix said it expanded its reach into the Republic of Ireland, inking a multi-year contract with a third tier-1 media client.

That strategic move positioned Fonix as the foremost provider of interactive services to media clientele in Ireland.

The company ended the year with 122 active customers, supplemented by new transacting clients such as Channel 4, RTÉ, and Wireless Ireland.

Despite losing a handful of smaller clients, Fonix successfully signed 23 new customer contracts, many of which would start transactions in the next year.

With a platform boasting 100% uptime, like in previous years, Fonix reported 18.9 million unique mobile users and 844 million interactions.

The company also highlighted considerable investments in new product features.

Fonix continued to record high retention rates on the client front, with more than 99% of income being recurrent.

Looking ahead, Fonix said it had started the 2024 financial year on a high note, with operations in line with board expectations.

Given the promising revenue pattern, a positive trajectory into the new fiscal year, and recent top-tier client acquisitions in the UK and Ireland, the board said it was optimistic about its growth prospects and heightened profitability.

“We have continued to make great progress on our strategic goals this year, seizing an initial client-led opportunity in Ireland to become the leading provider of interactive services for media customers in a second geographical market,” said chief executive officer Rob Weisz.

“New client wins from ITV, RTÉ, Channel 4 and Wireless Radio Ireland significantly underpin our growth expectations in the year ahead whilst at the same time creating high barriers to entry to prospective competitors.

“This year, we have added more depth to our team and products, with an eye on further international growth and broadening the services we can offer clients in the future.”

Weisz said the firm’s serviceable market had expanded significantly in the last 12 months through direct network connectivity in Ireland, adding that it would continue to consider establishing further direct connectivity in other territories in the 2024 financial year and beyond.

“The first few months of the new financial year have started strongly, with a robust run-rate of consumer activity with our key customers.

“We continue to make great progress on our strategic goals and recognise that by delivering on these objectives and nurturing recent client wins, we have a great opportunity to exceed expectations.”

At 1134 BST, shares in Fonix Mobile were up 1.15% at 193.2p.

Reporting by Josh White for Sharecast.com.