PEXA Group Ltd (ASX: PXA) shares had been on a roll over the past month, rallying by more than 30% to reach a recent peak of $17.18 per share.
However, this surge has turned out to be short-lived.
PEXA shares are trading 11% lower at the time of writing, changing hands at $15.05 apiece.
This comes after the company released its FY25 results this morning.
Evidently, its results for the year failed to live up to market expectations, triggering a sharp sell-off.
Let's find out what happened.
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What did PEXA report?
Revenue of $393.6 million grew by 16% from the previous year.
Group operating earnings (EBITDA) of $134 million increased by 21%, with the EBITDA margin inching up by 1.3 percentage points to 34.1%.
Free cash flow also jumped by 45% to $56 million.
However, adjusted net profit after tax (NPATA) dipped by 6% to $41.1 million.
Statutory NPAT fared even worse.
Here, the company reported a $76.1 million loss in FY25 following a 323% fall in this metric.
That said, PEXA's financial leverage improved from 2.5x last year to 1.8x in FY25.
What else happened in FY25?
PEXA is a digital property exchange and data insights business.
In other words, the group digitises and streamlines the process of buying and selling property in Australia, replacing traditional paper-based settlement processes.
PEXA also recently expanded internationally with a digital property transaction solutions business in the UK.
In FY25, the company's Australian business unit, PEXA Exchange, saw revenue lift by 7.5% to $313.8 million.
Management attributed this performance to continued growth in transaction volumes, the completion of its national rollout, and price increases.
In turn, EBITDA of $172.5 million grew by 8.4% for PEXA Exchange, with an EBITDA margin of 55.0%.
PEXA's international business also delivered an improved operating performance, headlined by 15.4% revenue growth to $60.7 million on a pro-forma basis.
Management noted that FY25 was a foundational year for the UK operations as the group finalised preparations for the launch of its platform.
PEXA believes that its existing product portfolio is capable of servicing 70% of UK property transactions, with further development planned to extend coverage to 80%.
The company's digital solutions arm also delivered a 21.7% rise in revenue to $19.1 million.
That said, PEXA recently commenced a strategic review of this business unit, which could result in either a divestment or further investment.
What did management say?
Commenting on the result, PEXA CEO Russell Cohen said:
In FY25, we grew Group revenue by 16%, improved cash generation, and strengthened our leverage, driven by contributions across all business segments. The Exchange in Australia now has 90% market coverage, and in the UK our product suite is ready for launch in early FY26. We were thrilled to see our UK lender engagement come to fruition through NatWest's written commitment in July 2025 to an implementation program. In Digital Solutions, we scaled the business and improved margins.
PEXA share price snapshot
PEXA shares have been rocked by high interest rates over the past few years.
However, the property settlement company has made a comeback in recent times.
Even factoring in today's decline, PEXA shares are up by 17% over the past year.
