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Highlights:

  • Gentrack reports NZ$112 million in revenue for H1 FY25, up 9.8% year-on-year.
  • Net profit after tax rises 34.7% to NZ$7.2 million, aided by forex gains.
  • Despite solid results, shares fall 5% amid high investor expectations.

Gentrack Group Ltd (ASX: GTK) shares moved lower on Monday, falling 5% to AU$10.58 following the release of the company’s half-year financial results to 31 March 2025. The market response reflects a contrast between sound financial performance and elevated investor expectations after a period of significant share price appreciation.

The utility and airport software provider posted group revenue of NZ$112 million, marking a 9.8% increase compared to the same period last year. This growth was driven by gains in both of Gentrack’s business divisions: Utilities and Veovo.

The Utilities segment, which comprises the majority of Gentrack’s revenue, grew 7.2% to NZ$92.8 million. Recurring revenue rose 17% due to new customer contracts and upsells. However, this was partly offset by a 12% decline in non-recurring revenue, which includes project-based income that did not match the elevated levels achieved in the prior period.

In contrast, the Veovo division, which provides software to airports, delivered a 24% revenue increase, reaching NZ$19.2 million. This performance was underpinned by airport upgrade and expansion projects in the UK, Middle East, and Asia-Pacific regions. Project-based revenue in Veovo grew 34%, with hardware sales contributing to the result.

EBITDA rose 5.1% to NZ$13 million which reflects continued investment in sales and product development. This includes costs related to the rollout of the company’s updated g2.0 platform, which recently went live with Genesis Energy in New Zealand.

Net profit after tax (NPAT) came in at NZ$7.2 million, representing a 34.7% increase on the prior period. The profit figure benefited from a lower effective tax rate and NZ$2.1 million in foreign exchange gains. However, it also includes a NZ$1.1 million loss attributed to Gentrack’s 10% investment in Amber Electric, an Australian energy retail technology company.

The company ended the half with NZ$70.7 million in cash, maintaining a conservative balance sheet. As in prior periods, no interim dividend was declared, with management opting to reinvest profits into the business and potential acquisitions.