The Catapult Group International Ltd (ASX: CAT) share price is catching the eye on Wednesday.
In morning trade, the global performance technology company's shares have jumped almost 10% to a 52-week high of $1.15.
Why is the Catapult share price jumping?
Investors have been scrambling to buy the company's shares this morning after it released an update on its performance during the first quarter. Here's a summary of its performance:
- Annualised contract value (ACV) growth exceeded 20% year on year on a constant currency basis.
- Revenue growth over 20% on a constant currency basis
- Annual ACV churn remains at record low levels below 5%
- Reaffirmed its guidance to be free cash flow positive in FY 2024
Management notes that with Catapult's transition to a software-as-a-service (SaaS) business complete, these results highlight its success at converting the prior period's ACV growth more directly into revenue growth.
Another positive was the company's annual ACV churn rate of under 5%. This is a whopping 12% improvement from the same time last year.
The company feels this metric signifies how deeply embedded its solutions are in the workflows of teams and the importance they play in professional sports.
But management isn't resting on its laurels. During the quarter the company continued its acceleration of product releases with the introduction of Vector Core Pro and a new version of its Pro Video Suite for Soccer. It also expects to introduce exciting new products during the current quarter that will continue to set the standards for professional sport.
Most importantly, Catapult has reaffirmed its guidance to be free cash flow positive in FY 2024 following this strong quarter.
Management commentary
Catapult's CEO, Will Lopes, commented:
We had a great quarter across all key growth metrics and continue to see record low levels of churn during one of our busiest renewal periods. Our discipline over the past year to return the Company to be Free Cash Flow positive whilst maintaining strong revenue growth, innovation, and retention continues to bear fruit. We are very well set up to deliver on our guidance. Although the Company isn't in the practice of providing quarterly trading updates, on this occasion the significance of our transition towards positive cash flow justified providing a more granular view of how the business is tracking.
