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Market Analysis Latest ASX News

RPMGlobal [ASX:RUL] Reviews FY23’s Half-Year Results

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By Mahlia Stewart, Tuesday, 21 March 2023

Mining industry consultant and software group RPMGlobal has released an updated investor presentation, making some changes to key financial points presented in February.

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:

ASX:RUL RPMGlobal Holdings Stock Chart News 2023

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.

ASX:RUL RPMGlobal Holdings FY2023 EBITD Gudiance

Source: RPMGlobal

 

Are you prepared for the big economic shift?

Australia’s 30 years of abundant, robust trade has now been broken.

The change is all around us, the global supply chain has twisted. You can see it on the supermarket shelves.

There’s also the issue of closing banks, soaring prices, shrinking packaging, and gaps in the workforce.

Even RPM has claimed of a ‘war on talent’ is making it difficult to hire staff with the required skills.

The change is all around us. Jim Rickards, one of the world’s top financial and geopolitical analysts, has joined the dots nobody else has.

Most Australians just don’t know what it all really means, or how it happened.

Australia is going to be looking very different very soon, and so will everyday life…

If you want to know how you can prepare for the biggest geoeconomic shift of our lifetime and gan explanation from Jim Rickards himself, click here to learn more.

 

Regards,

Mahlia Stewart

For Money Morning

All advice is general advice and has not taken into account your personal circumstances.

Please seek independent financial advice regarding your own situation, or if in doubt about the suitability of an investment.

Mahlia Stewart

Mahlia’s Premium Subscriptions

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