Pointsbet Holdings Ltd (ASX: PBH) shares are having a very strong session on Thursday.
At the time of writing, the small cap ASX stock is up 19% to 59.5 cents.
This follows the release of the sports betting company's full year results.
Small cap ASX stock rockets on results day
- Net win up 16% to $267.1 million
- Gross profit margin improved 2.5 percentage points to 52.8%
- Operating expenses down by $10.3 million
- Normalised EBITDA loss of $1.8 million
What happened during the year?
It certainly was a transformative year for the small cap ASX stock. During the 12 months, the company sold its US operations and returned the majority of the proceeds to shareholders.
What was left of the business (Australia/Canada), delivered a 16% increase in net win to $267.1 million. This was in line with its guidance for growth of 10% to 20% over FY 2023's numbers.
Coming in ahead of its guidance was its gross profit margin, which lifted to 52.8%. This compares to its guidance of ~50%.
And at the low end of its guidance range (in a positive way) were its operating expenses of $60.4 million. Management was targeting expenses of $60 million to $70 million.
But the cherry on top was that its EBITDA loss narrowed to just $1.8 million from $49 million a year ago. This was better than management's guidance of a loss of $4 million to $6 million.
Management commentary
The small cap ASX stock's CEO and chair were pleased with the 12 months. In a joint statement, they said:
This outstanding result has been driven by record full year Group Net Win of $267.1 million, up 16% on FY23. Our improved efficiency and productivity has also been a critical catalyst. We continue to invest for further growth, in particular in our core technology and product capabilities and through our strategic marketing investment. This is driving our market share growth in Australia and Canada and setting the Company up for further success in FY25 and beyond.
Commenting on the future, they add:
We are excited about the future ahead of PointsBet. Firstly, our proprietary tech stack is a global market leader as validated by our sale of the platform to the Fanatics. While we have sold a copy of the technology to the Fanatics, importantly we also get to keep the technology. That means we can develop and exploit it in a manner that creates the most value for PointsBet shareholders.
Outlook
Pointsbet is guiding to the following in FY 2025:
- Revenue of $280 million to $290 million, representing growth of 14% to 18%.
- Positive EBITDA of $11 million to $16 million (from a $1.8 million loss)
- Cash flow breakeven in FY 2025
