Key highlights:
- Revenue up 88% to $20.3M (1H22: $10.8M), in line with management expectations
- Strong Digital Vending MachineTM (DVM) traction in the US. New deal in 1H means Bango has secured 3 out of 5 key US telcos, opening up subscription bundling to >200M US customers
- The DOCOMO Digital (DDL) integration cost synergies are 90% complete. On track to deliver profitability in line with consensus expectations.
Financial Overview:
| Results for the 6 months ended 30 June 2023 | 1H23 | 1H22 | Change |
| Revenue | $20.3M | $10.8M | +88% |
| Annual recurring revenue (ARR) 1 | $5.6M | $3.4M | +63% |
| Adjusted EBITDA2 | ($0.2M) | $2.9M | |
| Profit/(Loss) before taxation | ($4.9M) | ($4.9M) | |
| Cash | $13.4M | $5.7M |
Financial highlights:
- Revenue increased to $20.3M (1H22: $10.8M). Growth driven by payment & subscription volumes, new DVM contracts and a contribution from the acquisition of DDL. Bango payments revenue, including the DDL contribution is typically 40:60 weighted 1H:2H
- ARR grew to $5.6M. This growth will accelerate as DVM contracts won in 1H23 launch
- Gross profit margin remains high at 90% in 1H23 (2H22: 90%)
- Actions to deliver $19M of the $21M of guided cost synergies are already complete and the benefit to profit margins of synergy actions taken in 1H23 will materialize through 2H23
- Adjusted EBITDA2 of -$0.2M (1H22: $2.9M), is ahead of the July trading update and reflects the impact of costs associated with the DDL integration. Adjusted EBITDA is in line with management expectations for 1H23
Operational highlights:
- 2 new US DVM wins in 1H23, including 1 additional top 5 US operator, strengthens Bango leadership position in the US market
- DVM contract with Japanese employee benefits provider, Benefit One, illustrates the additional opportunity for the DVM in verticals outside telco
- Bango Payments continues to grow, evidenced by the new Amazon and Google routes announced
- 22 new merchants connected to the Bango Platform in 1H23 with an increasing number using Bango Audiences, to find new paying consumers and drive growth.
Outlook
- Bango is on track to meet consensus market expectations for the full year
- There is a healthy pipeline of DVM deals. The expected launch of services from the wins in the first half gives Management confidence that Bango will exit the year with a run rate of $10M ARR
- As full synergies from the acquisition are realised, Bango will see Adjusted EBITDA margins increase and is on track to deliver a substantial increase in Adjusted EBITDA for FY24
- Strong free cash flow generation expected in FY24.
Paul Larbey, Chief Executive Officer of Bango, commented:
“I am excited about the opportunities for our Super Bundling strategy. Our leadership in the telecommunications market was extended by the acquisition of DOCOMO Digital one year ago. Profitability and cash generation will grow, as we deliver on the synergies from the acquisition. Our focus on the Digital Vending Machine is already delivering revenue growth. The recurring revenue generated from the DVM deals already won will drive exponential growth in the years to come.”
Presentation and Webcast
A presentation of the interim results will be made to investors and analysts at 8.30am this morning via the Investor Meet Company Platform. Those wishing to join the call can sign up to Investor Meet Company for free and add to meet BANGO PLC via: https://www.investormeetcompany.com/bango-plc/register-investor
Notes
1 ARR is calculated by annualizing the June 2023 revenue derived from ongoing, contracted, repeating revenues
2 Adjusted EBITDA is earnings before interest, tax, depreciation, amortization, share based payment charge, negative goodwill and exceptional items.
