Rising Costs and Trade Risks Cloud DataDot’s EBITDA Despite Profit Gains

Solid Revenue and Profit Growth

DataDot Technology Limited (ASX, DDT) has delivered a robust financial performance for the full year ended 30 June 2025, reporting a 13.1% increase in revenue to $3.37 million and a 56% jump in net profit after tax to $112,796. This marks a significant improvement in bottom-line profitability despite a 24% decline in EBITDA, which was impacted by increased operating expenses.

EBITDA Pressure from Strategic Investments

The EBITDA contraction to $385,471 from $507,872 in FY24 reflects higher staffing costs and investments in the PropertyVAULT platform. The company has expanded its resources to support business growth, including software enhancements and marketing efforts for PropertyVAULT, its digital asset protection and recovery platform. These investments underline DataDot’s commitment to evolving its business model beyond traditional asset identification.

PropertyVAULT Insurance Services Gains Traction

A key highlight for the year was the successful pilot of PropertyVAULT Insurance Services with a Tier 1 Australian insurer, which concluded in June 2025 and delivered multiple asset recoveries. Building on this momentum, DataDot secured a second pilot agreement with another Tier 1 insurer, effective through April 2026. This segment is expected to become a primary revenue driver, leveraging the company’s technology and national asset register to support insurers in theft prevention, validation, and recovery.

Geographic and Segment Diversification

DataDot’s revenue growth was supported by a 7.4% increase in product sales, with notable strength in the Direct-to-Business and Consumer segment (+13.5%) and a remarkable 70.1% surge in Trace product sales. Royalty revenues rebounded strongly, helped by resumed sales through DataDot South Africa to Toyota Motor Europe, increasing royalties by nearly 40%. The company also anticipates further growth from a new Asian distributor expected to commence operations in the fourth quarter of FY26.

Financial Position and Outlook

DataDot remains debt-free with a solid cash position of $3.1 million, slightly down from $3.25 million the previous year. The Board has confirmed no need for capital raising in FY25, maintaining a focus on liquidity and long-term financial stability. Looking ahead, FY26 is positioned as a pivotal year with expected contributions from all core segments. The company forecasts modest growth in its microdot identification segment, stable performance in DataTraceID, and a material revenue contribution from the scaling PropertyVAULT Insurance Services.

While global trade volatility and US tariff uncertainties pose risks, DataDot’s diversified revenue streams and strategic insurer partnerships provide a strong foundation for sustainable growth.