IVE Group (ASX:IGL) has revealed its financial performance for the first half of FY22 (ending 31 December 2021), reporting $20.9 million in net profit after tax (NPAT).
The result is a 99 per cent rise from the previous corresponding period, which it said is a result of solid revenue growth, stable margins and leverage of the recalibrated cost base.
Its revenue was reported at $382.6 million, up 12.2 per cent from the same time last year, while its EBITDA was $55.2 million, up 24.7 per cent from last year.
Its net debt was reported at $78.7 million.
In an earnings call, IVE Group executive chairman Geoff Selig went through the company’s strategy execution, capital management and future growth initiatives.
“Since listing in December 2015, strong free cashflows and access to capital has enabled the company to execute a transformational investment program that has further expanded our diversified integrated marketing communications offer,” he said.
“The disciplined execution of our strategic investment program over the last five years has resulted in significant increases in both revenue and earnings, albeit FY20/21 were COVID impacted.”
Having recorded an operating cashflow of $375 million and a free cashflow of $279 million between FY17 and FY21, he added that the company aims to continue to organically grow its revenues and earnings.
“The strength of our balance sheet places us in a very good position post COVID-19 to invest across a range of strategic, organic initiatives together with opportunities that may be present in terms of attractive acquisitions,” Selig said.
He also added that the company has allocated $30 million to $40 million to invest in a range of opportunities, including growing its fibre-based packaging offer and enhancing and amplifying its Lasoo solution. Selig also expects several “bolt on acquisition opportunities” will present over the coming 12 to 24 months.
“For us, our business is not about one channel. Our business is about an integrated offering and communicating customers across multiple channels. And that means we play quite heavily in traditional channels like print and the range of digital channels,” he said.
“That’s the power of the offer we take to market and that is ultimately the way most of our clients communicate.”
IVE Group CEO Matt Aitken said, “A clearly defined and well executed strategy over the long term has cemented IVE as the largest integrated marketing communications business in Australia, holding leading market positions across all sectors in which we operate. This places us in a strong position as we emerge from the significant disruption of the last two years.
“Pleasingly, heightened operating leverage across the business has contributed to a significant uplift over our H1 FY21 performance, as existing client revenue rebounds and recently secured new business phases in.
“Revenue momentum continues, and the company remains optimistic this will continue over the remainder of the FY22 year.”
Aitken also commented on the integration of both Active Display Group and AFI Branding (which it acquired on 1 November 2021), saying the integration is “progressing well” and that it will be completed by the end of June this year.
Post-integration, it expects to achieve $45 million of annualised revenue, an EBITDA of $6.5 million and an NPAT of $4 million.
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