Way2VAT Surges with Record $1.49M Q4 Revenue and 43% FY24 Growth
Way2VAT has posted a record quarterly revenue of A$1.49 million in Q4 FY24, driving a 43% increase in full-year revenue to A$4.72 million. The fintech continues to expand its enterprise client base and implement cost reductions to support future growth.
- Q4 FY24 revenue hits record A$1.49 million, up 49% year-on-year
- Full-year FY24 revenue grows 43% to A$4.72 million
- Enterprise clients increase to 395, including major multinational contracts
- Operating expenses cut by approximately 20% from December 2024
- Firm commitments secured to raise A$2.6 million via convertible notes
Strong Revenue Growth and Client Expansion
Way2VAT Ltd (ASX:W2V), a global fintech leader in automated VAT reclaim solutions, has delivered a standout performance in the fourth quarter of FY24, reporting record quarterly revenue of A$1.49 million. This represents a 49% increase compared to the same period last year and contributes to a full-year revenue tally of A$4.721 million, up 43% from FY23.
The company attributes this growth to the successful onboarding of new enterprise clients and the expansion of services within existing accounts. Notably, Way2VAT secured contracts with several multinational firms, including a significant real estate services company covering approximately 130 entities across Europe. This contract also incorporates Way2VAT's innovative APAI Compliance product, which leverages AI and machine learning to enhance VAT compliance and reclaim accuracy.
Operational Efficiency and Cost Management
Alongside revenue gains, Way2VAT has implemented substantial cost-saving measures, achieving an approximate 20% reduction in operating expenses on an annual run-rate basis starting December 2024. These savings stem from headcount and salary reductions, as well as other efficiency initiatives. The full impact of these cost controls is expected to be reflected in the upcoming Q1 FY25 results, potentially improving the company’s cash flow position.
Despite strong revenue growth, cash receipts for the quarter were A$758,000, up 62% year-on-year but still trailing revenue due to delays in VAT reclaim processing by certain European tax authorities. This has led to an increase in accounts receivable to approximately A$4.5 million, highlighting a working capital challenge that the company is actively managing.
Capital Raising and Financial Position
To support its growth trajectory and operational needs, Way2VAT has secured firm commitments to raise a total of A$2.6 million through the issuance of convertible notes to key shareholders, including its largest investor, Thorney Investment Group. As of the report date, A$800,000 has been received, with the balance expected by the end of March 2025. This capital injection is critical as the company navigates its path to cash flow break-even.
Way2VAT’s CEO, Amos Simantov, expressed confidence in the company’s pipeline and technology validation through recent tender wins. He highlighted the strong momentum from new client onboarding and the promising outlook for VAT reclaim submissions in coming quarters, despite ongoing challenges with tax authority payment delays.
Looking Ahead
With a growing client base now totaling 395 enterprise customers and a differentiated technology platform, Way2VAT is well positioned to capitalize on increasing demand for automated VAT recovery solutions globally. The company’s strategic focus on expanding its APAI Compliance product and improving cash collections will be key areas to watch as it seeks to convert its revenue growth into sustainable profitability.
Bottom Line?
Way2VAT’s record revenue and strategic cost cuts set the stage for a pivotal year ahead, but cash flow and receivables management remain critical challenges.
Questions in the middle?
- How quickly will Way2VAT convert its growing accounts receivable into cash?
- What impact will the APAI Compliance product have on future revenue streams?
- Can the company sustain its recent client acquisition momentum amid competitive tendering?
