Mining advisory consultant, training, and software group RPMGlobal Holdings [ASX:RUL] wished to update its FY23 half-year results in a new version of the investor presentation that was initially released early last month.
Among its updates, the group reaffirmed FY23 EBITDA guidance of $14.2 million, and presented key financial changes to other guidance benchmarks and expense milestones such as customer and restructuring costs post-merger.
The RUL share price was down slightly by the early afternoon after making its update public and was trading at $1.36 at the time of writing.
The mining consultants had seen their share price fall 22% in the year so far, 14% in the month, and 6.5% in the last week alone:
www.TradingView.com
RPMGlobal’s 1H FY23 investor update
The mining software and advisory group updated FY23 expectations, having presented its initial FY23 first-half results on 2 February.
RPM reaffirmed the EBITDA (earnings before interest, tax, depreciation, and amortisation) guidance of $14.2 million — not inclusive of merger and acquisition costs of $0.4 million for ESG company Nitro Solutions — and had a few things to say about other financial changes to last month’s guidance.
The changes consisted of:
- A Ukrainian company withdrew its force majeure notice on a project payment, which resulted in $0.7 million in ‘other income’.
- Perpetual licenses are expected to lift by $1.3 million, thanks to the group’s ‘country collection risk’ software pipeline.
- a $0.4 million benefit in the second half of the year occurred off the back of restructuring roles in the Americas’ software department.
- Support revenue reduced by $0.6 million due to the South African zar’s fall against the Australian dollar.
- A further $1.3 million in support revenue fell after four larger customers moved off perpetual licenses to subscription licenses.
- Software development costs are now expected to be $0.7 million higher in FY23, following a drop in employee attrition.
The company flagged a ‘war on talent’ has translated to overuse of subcontractors, further pushing up costs in order to meet demand.
RPM also reported splashback costs of $0.25 million (net of revenue) are expected in FY23 as a result of merger and acquisition costs for Nitro, while its related advisory services will take another $0.15 million in expenses.
The company now expects total revenue for FY23 to be $96.4 million, which is down $4.6 million from the previous guidance of $101 million.
RPM says it still needs to contract $2 million in subscription revenue and $1.3 million perpetual licence revenue for FY23, though the Advisory division was said to have sold enough to achieve its target.
In terms of outlook, the company said it is excited about opportunities within its software pipeline and is pleased with progress in Indonesian and South Asia markets.
It believes it can continue its current momentum and is encouraged by increased interest in its next generation mobile solutions for technicians ana planners across remote mining sites.
Source: RPMGlobal
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