Challenger telco Amaysim has come out the other end of a rough 2019 with renewed focus on its burgeoning energy business and new technology stack.
The company, which made the decision to exit its broadband business in October 2018 after just 18 months, reported (pdf) revenues of $508 million for the ending 30 June 2019, down eight percent from the prior year.
EBITDA fell nine percent to $44 million, while net profit dropped from $14.75 million in FY18 to a $6.5 million loss in FY19. However, Amaysim reported $8.75 million in net profit after “adding back the tax affected amortisation and impairment relating to acquired contracts and intangibles other than software.”
Amaysim pinned its waning financial performance on “intense competition in the mobile market” along with a highly regulated energy market. The company said there were early signs that the upheaval within the mobile market is set to ease with the rollout of 5G networks this year as telcos refocus on improving ARPU rather than aggressively expanding their customer bases.
The telco also gave a clearer indication of the costs of exiting its broadband business in October last year due to high wholesale costs and low margins for the foreseeable future. Amaysim broke out its results for its broadband business before it closes.
The broadband business made $4.3 million in revenue, down from $7.3 million in FY18, resulting in a $4 million loss before income tax adjustments. Amaysim made a gross profit of $3.28 million from selling its broadband customer base to Southern Phone Company.
Amaysim also exited its device reseller business in FY18, which made $846,000 in revenue before its closure, down from $1.28 million in FY18, resulting in a $1.1 million loss after income tax adjustments.
The company also mentioned investments in a new technology stack to support future growth. Amaysim is consolidating its existing systems and processes to create a new unified architecture in an effort to drive operational efficiencies, service customers more effectively and speed up time-to-market for new products. The new technology stack was purpose built for Amaysim’s subscription services, as well as to launch new energy subscription plans.
Amaysim’s shares were trading at 61 cents each, down nine percent at the time of writing.