This ASX All Ordinaries tech share just delivered 24% revenue growth

This tech insurance company is quietly humming along…

| More on:
Business meeting to discuss buy now pay later platform

Image Source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • Fineos Corporation released its first-half results for FY22 on Thursday 
  • Revenue increased 24% while bottom-line losses narrowed in a promising sign 
  • The company guided towards the bottom end of its 125 million euros and 130 million euros revenue guidance for FY22 

Among the flurry of earnings flying out this month, you might have missed this ASX All Ordinaries tech share which produced solid top-line growth in the first half.

The Fineos Corporation Holdings PLC (ASX: FCL) share price is finishing the week lower than where it started.

However, shares in the insurance software provider climbed 3.1% today after falling 3% yesterday. This follows the release of Fineos' results for the first half of FY22 on Thursday.

ASX All Ordinaries tech share slips despite productive half

  • Revenue up 24.4% to 65.4 million euros (A$102.04 million)
  • Annual recurring revenue reached 51.8 million euros, increasing 35.2% year on year
  • Gross profit of 42.5 million euros, representing an increase of 25.6% year on year
  • Earnings before interest, tax, depreciation, and amortisation (EBITDA) up 103.1% to 6.5 million euros
  • Net loss after tax narrowed to 4.6 million euros from 5.1 million euros
  • Cash balance as at 31 December 2021 of 48.6 million euros

What else happened during the half?

Investors have lacked an attraction to this ASX All Ordinaries share this week. However, Fineos showed improvement across all of its key metrics in the first half.

According to the release, top-line growth of 24.4% was driven primarily by cross-selling and up-selling to its existing client base. In addition, the company notched up another client win, helping diversify its customer base.

Notably, the largest organic growth was witnessed in Fineos' subscription revenue — increasing 39.5% year on year. Meanwhile, services revenue experienced a 16.4% improvement on the prior corresponding period.

Furthermore, the company highlighted its improvements in de-risking its client concentration during the period. In August 2021, 74% of Fineos' revenue was tied to its top 10 clients. However, that number has been reduced further to less than 61%.

During the half, Fineos raised around $74 million to feed future growth across its operations and expand into new markets.

What's next?

Investors might have been displeased to see Fineos guide towards the lower end of its previously stated revenue range for FY22. For reference, the range provided is between 125 million euros and 130 million euros.

Although, on a positive note, the company reaffirmed expectations for subscription revenue to grow at an annualised rate of around 30%. This was followed up with a disclaimer, noting the guidance is subject to prevailing influences from COVID-19 and the global economy.

How has this ASX All Ordinaries tech share performed?

The Fineos share price has been unable to attract a higher value so far in 2022. In fact, shares in the insurance tech provider have slumped 27% since the year kicked off.

To be fair, this is relatively in line with the broader performance across the tech sector. For example, the S&P/ASX All Technology Index (ASX: XTX) is down 23% year to date.

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has recommended FINEOS Corporation Holdings plc. The Motley Fool Australia has recommended FINEOS Corporation Holdings plc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Earnings Results

Photo of two women shopping.
Earnings Results

Premier Investments share price jumps 9% on results and demerger plans

The Smiggle and Peter Alexander owner has released its results. How did it perform?

Read more »

A man holds his hand under his chin as he concentrates on his laptop screen and reads about the ANZ share price
Earnings Results

Soul Patts share price struggles on falling profits

ASX 200 investment house Soul Patts reported its half year results this morning.

Read more »

a biomedical researcher sits at his desk with his hand on his chin, thinking and giving a small smile with a microscope next to him and an array of test tubes and beackers behind him on shelves in a well-lit bright office.
Earnings Results

Chemist Warehouse merger target Sigma reports 149% FY24 profit jump

This could be the last set of results from Sigma as we know it if its merger is approved.

Read more »

A man holds his head in his hands, despairing at the bad result he's reading on his computer.
Earnings Results

Brickworks share price tumbles on disappointing half-year loss

This loss didn't stop the company from increasing its dividend again.

Read more »

A man sits on a bench atop a mountain with a laptop, making investments with a green ESG mind.
Earnings Results

ASX All Ords stock KMD tumbles as interim dividend cancelled

Investors are hitting the sell button on ASX All Ords stock KMD today.

Read more »

Coal miner holding a giant coal rock in his hand making a circle with his hand, symbolising a rising share price.
Energy Shares

New Hope share price charges higher despite profit crunch and huge dividend cut

Weaker coal prices have hit this miner's profits and dividend hard.

Read more »

A Chinese investor sits in front of his laptop looking pensive and concerned about pandemic lockdowns which may impact ASX 200 iron ore share prices
Earnings Results

Liontown share price tumbles 7% on half-year results

This lithium developer's results have been released this afternoon.

Read more »

A man in a hard hat and high visibility vest holds his thumb up in a gesture of confidence with heavy moving equipment in the background as on a mine site as the Chalice Mining share price rises today.
Earnings Results

Sayona Mining share price jumps despite $32m half-year loss

The Sayona Mining Ltd (ASX: SYA) share price is pushing higher on Thursday. At the time of writing, the lithium…

Read more »