Eservglobal Ltd (AX:ESV) reported FY16 results in line with its recent trading update. The turnaround in the core business is evident with H216 revenues 58% higher than in H116 and adjusted EBITDA losses significantly reducing over H216. Continued contract momentum combined with good cost control puts the company on track to generate positive EBITDA for FY17. At the same time, the HomeSend joint venture expects to see revenue contributions from new partners coming on line and continues to target break-even in CY17.
H216 results show recovery in core business
eServGlobal reported FY16 revenues of A$21.6m (-16.6%), in line with its recent trading update, and confirming a pick up in revenues in H216 (H1 A$8.4m, H2 A$13.2m). FY16 adjusted EBITDA loss of A$7.0m was slightly better than our forecast, reflecting costs at the lower end of the expected range, with the H216 EBITDA loss reduced to A$0.4m. The company ended the year with gross cash of A$9.4m and net debt of A$2.4m.
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