The Pushpay Holdings Ltd (ASX: PPH) share price has rocketed 25.9% higher this morning after the company provided a business update in relation to the coronavirus outbreak as well as an updated earnings guidance for the 2020 financial year.
Pushpay is a payments company which provides a donor management system to the faith sector and non-profit organisations in North America and the ANZ region.
Pushpay released its interim results covering the six months ended 30 September 2019 to the market back in November last year.
Increased demand for Pushpay's services
This morning, Pushpay advised that at this stage, it doesn't believe its financial performance for the year ending March 2020 is going to be adversely impacted by the global coronavirus pandemic.
Despite the fact that a number of organisations that utilise its services are temporarily closing their physical premises, Pushpay's technology is actually seeing an overall increase in demand as church congregations utilise the company's mobile technology solutions for a range of their activities.
The company's digital processing volume over the most recent weekend was much higher than what it had expected prior to the coronavirus.
Pushpay noted that some of its customers have already suspended in-person gatherings as they take precautionary measures to stem the contagion of the coronavirus. Instead, customers are implementing alternate strategies which include the use of live-streaming church services, connection between church members through Pushpay's apps, holding much smaller group meetings and donation giving via digital channels.
Impact of coronavirus on staff
Pushpay commented that it can implement a strategy for all of its staff to work remotely for extended periods, if necessary, due to the coronavirus outbreak. The company added that this strategy has already been implemented in its Redmond, Washington, and Colorado offices in the US.
Upgraded FY20 guidance
Pushpay noted that its previous guidance for operating revenue, gross margin and total processing volumes for the year ending March 2020 would remain unchanged. Operating revenue remains between US$121.0 million and US$124.0 million, a gross margin of over 63% still applies and total processing volume of between US$4.8 billion and US$5.0 billion still stands.
However, Pushpay has raised its expectations for foreign currency-adjusted EBITDA (EBITDAF) to between US$25.0 million and US$27.0 million for FY20, up from between US$23.0 million and US$25.0 million.
All of these ranges exclude the acquisition of Pushpay's ownership interests in Church Community Builder and other associated costs with this acquisition.
