Fonix Mobile gross profits rise in strong first half

(Sharecast News) - Mobile payments and messaging technology company Fonix Mobile reported a 17.9% rise in gross profit in its interim results on Tuesday, to £9.2m, while adjusted EBITDA increased 17.7% to £7.3m. The AIM-traded firm hiked its interim dividend for the six months ended 31 December by 10.2% to 2.6p.

Adjusted profit before tax climbed 25.4% to £7.4m, and adjusted earnings per share advanced 16.3% to 5.7p.

Underlying cash at the end of the period stood at £11.2m, making for an increase of 33.3%, while net underlying free cash flows from operating activities rose 20% to £6.6m.

On the operational front, December saw record levels of commercial trade, indicating strong market demand and effective sales strategies.

The company launched its new subscription manager product, positioning itself for major charity events slated for 2024 and diversifying its revenue streams.

Fonix said it maintained high client retention, with over 99% of income being of a recurring nature, highlighting its ability to foster long-term partnerships.

Despite handling record transaction volumes and consumer engagement, Fonix said it ensured 100% platform uptime during the period.

Key service lines experienced growth, and the company said it held a significant pipeline of enterprise prospects for the second half of the financial year.

Looking ahead, Fonix said it anticipated maintaining its strong performance, with the second half starting on a positive note.

Gross profit was expected to remain slightly weighted towards the first half due to seasonality in the trade of significant media customers.

In line with its growth strategy, Fonix said it was planning to continue investing in future growth, including product development and organic international expansion.

"We've made excellent progress on our strategic priorities in the period, once again nurturing significant growth from both established clients and newly onboarded customers alike," said chief executive officer Rob Weisz.

"As we have begun to explore overseas markets we have identified territories with favourable market dynamics and exciting growth potential.

"At the same time we have continued to add significant additional depth to our product offering, expanding our competitive advantage and creating the founding dimensions for growth into the future."

At 1136 GMT, shares in Fonix Mobile were up 4.47% at 253.33p.

Reporting by Josh White for Sharecast.com.