The Catapult Group International Ltd (ASX: CAT) share price is on watch today following its unaudited FY20 results preview announcement.
What did Catapult announce?
The company announced it generated net free cash of $9 million in FY20 which represents an improvement of $24.1 million on FY19. As a result, the company achieved positive cash flow a year earlier than forecast. This was assisted by its subscription-based business model.
Despite the coronavirus pandemic impacting on sporting events around the world, revenue and earnings before interest, tax, depreciation and amortisation (EBITDA) continued to grow.
Catapult had a total cash balance as at 30 June 2020 of $27.5 million. In addition, total revenue is expected to be between $100 million and $101 million. EBITDA is expected to be between $11.5 million and $12.5 million. Additionally, Catapult's earnings increase was assisted by its temporary cost cutting initiatives.
Growing customer demand
Some professional sporting leagues have restarted or are about to restart competitions globally. In Australia, the National Rugby League (NRL) and Australian Football League (AFL) have recommenced competitions.
Catapult has continued to win new customers and retain existing customers during the worldwide lockdowns.
However, the group has warned delays and temporary closures of sports have shifted the sales cycle. As a result, sales that would have been made in Q4 2020 are now expected in 1H21. The full impact of events on FY21 is not yet known.
CEO comments
Commenting on Catapult's update, the company's CEO, Will Lopes, said: "While we expect the sales impact of COVID-19 to continue for some time, our pipeline remains strong for FY21. The experience level of our executive team coupled with the dedication of our staff, has positioned us to effectively navigate this period, delivering solutions and support to our customers".
About the Catapult share price
The results today follow the appointment of a new Chief Operating Officer (COO), Chris Cooper, announced to the ASX on 16 July 2020. Chris was a former Amazon executive at Audible, holding the position of Executive Vice President of International Operations and New Business Expansion. As such, his international experience will be invaluable for Catapult as it looks to maintain and grow its market leading position in sport technology.
The Catapult share price has had a strong performance in the past year with growth of 21.53%. Currently it is trading at $1.27.
