Gentrack Group Ltd (ASX: GTK) shares are starting the week with a bang.
In morning trade, the ASX 300 tech stock is up a massive 21% to $8.01.
This follows the release of the utilities and airport software company’s full year results for FY 2025.
ASX 300 tech stock rockets on results day
For the 12 months ended 30 September, Gentrack posted an 8% increase in revenue over the prior corresponding period to NZ$230.2 million. This was in line with its guidance for the financial year.
Recurring revenue jumped 13% to NZ$155.4 million, with both its Airports (Veovo) and Utilities divisions contributing to the uplift.
The company’s Utilities arm saw revenue increase 7% to $193.4 million. This was driven by a 12% rise in recurring revenue from new customer wins and platform upgrades.
The airports division, Veovo, also delivered a strong year, operating across more than 25 countries and 150 airports. Revenue rose 15% to NZ$36.8 million, with underlying revenue growth of 30% excluding hardware sales. Recurring revenue increased 18%, supported by new customer wins in the UK and Middle East and upgrade activity across the AsiaâPacific region.
EBITDA came in at NZ$27.8 million for the 12 months, which represents 18% growth over the prior year. Importantly, the company emphasised that this result was achieved despite expensing all R&D and g2.0 investment costs.
On the bottom line, the ASX 300 tech stock record a statutory net profit after tax of $20.9 million, marking a substantial 119% year-on-year increase. This result included a $2.2 million loss relating to Gentrack’s 10% stake in Amber, as well as $3.2 million in foreign exchange gains from the appreciation of key currencies such as the British pound.
Cash generation remained strong in FY 2025, with year-end cash of $84.8 million. This is up $18.1 million from FY 2024.
However, the board has elected not to pay a dividend, noting that both the Utilities and Veovo businesses operate in high-growth and consolidating markets. It believes that capital is best directed toward expansion.
Outlook
The ASX 300 tech stock’s management team is confident that its growth will continue in FY 2026.
It signalled further momentum ahead, stating that it is “confident that revenue growth will be higher in FY26 than in FY25.” Though, it concedes that it is too early to provide detailed guidance.
Looking further out, Gentrack reiterated its mid-term target of more than 15% compound annual revenue growth and an EBITDA margin of 15%â20%, with all development costs continuing to be expensed.
Despite today’s strong gain, the company’s shares remain down by 30% since the start of the year.
The post Why is this ASX 300 tech stock rocketing 21% today? appeared first on The Motley Fool Australia.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Gentrack Group. The Motley Fool Australia has positions in and has recommended Gentrack Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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