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Whispir Limited, digitisation driving customer growth

Team Veye | 23 Feb 2021 ASX - WSP
Whispir Limited, digitisation driving customer growth

Whispir Limited (ASX: WSP) 

Whispir Limited (ASX: WSP) on 19 February 2021 confirmed that its wholly owned subsidiary, Whispir Australia Pty Ltd, had renewed its business partner agreement (Telstra BPA) with Telstra Corporation Limited (Telstra) for a further period of three years, on the same terms and conditions. The Telstra BPA provides for Telstra entering into contracts with its customers for the re-sale of the Whispir platform and other services. It also provides the terms under which Telstra uses the Whispir platform and services for its own internal purposes.

(Chart source: TradingView)

On 18 February 2021, the company presented its half yearly report for the period ended on31 December 2020.

Highlights:

  • Total revenue increased by 27.3% or $4,966k in the half-year to 31 December 2020, compared with pcp. Very strong performances were achieved in ANZ and Asia where revenue increased by 30.2% and 24.4% respectively
  • Revenue growth of 27.3% was achieved compared to the cost of services growth of 31.7%.
  • Customers are continuing to expand their use of the platform with the number of customers using 4+ use cases increasing to 89 from 60 over the pcp and average monthly recurring revenue increasing from $16.2k to $26.0k, against PCP. As a result, transaction revenue increased by 34.1%

(Graphic Source – Company Reports)

  • Growth for the half was supported by the onboarding of 77 net new customers, delivering a total of $1,303k in new revenue.
  • The loss for the Group after providing for income tax amounted to $3,456k compared to a loss of $6055k on 31 December 2019. The 42.9% improvement in net loss after tax compared to the prior corresponding period (‘PCP’) was predominantly driven by a 27.3% increase in revenue and a 17.6% decrease in General and Administration costs.
  • The gross margin declined slightly to 60.7% from 62.0% in the PCP.
  • EBITDA improved to a loss of $1,828k for the period, a $2,931k or 61.6% reduction compared to PCP
  • EBITDA excluding non-cash share-based payments expenses improved by 75.8% to a loss of $940k.
  • Net cash balance of $10.9 million
  • Investment in Research and development (R&D) remains a key objective of the Group with investment increasing by 8.8% or $455k on pcp.
  • General and administration expenses of $5,853 declined significantly by $1,252k or 17.6% compared with the pcp
  • Finance costs at $243k were in line with the PCP, and the income tax expense relates to tax expense in the Singapore domiciled subsidiary

FY21 Guidance:

  • FY21 ARR to report 26%-31% growth on FY20 to $53m-$55.3m
  • FY21 Revenue to report 25-30% Growth on FY20 to $49.0m-$51.0m
  • FY21 EBITDA to report 38-59% improvement on FY20 to $(4.5m)-$(3.0m)
  • FY21 R&D Cash Investment to report 8% -15% Growth on FY20 to $9.2m-$9.8m (Data Source – Company Reports)

 

Veye’s Take

Whispir is delivering on its growth strategy, increasing platform usage by existing customers and acquiring new customers in its key markets of ANZ, Asia and North America. The Company is enhancing its proven channel sales capabilities and developing new partnerships with system integrators and value add resellers. The company with its proven track of strong revenue growth and ongoing cost management abilities is evolving to a communications intelligence company, harnessing data-driven insights to improve customer engagement. The stock after forming “Bullish engulfing” is trading above the middle band of the Bollinger. It has managed to close above the previous close of the “Doji candle”. It can have the potential to grow significantly in the near to medium term. Veye maintains a “Hold” on “Whispir Limited” at the current price of $4.33

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