- Software company WiseTech Global (WTC) has dropped more than 17 per cent today after downgrading its full-year guidance
- In its 2019 financial report, the company projected FY20 revenue would reach $460 million, with an EBITDA of $153 million
- However, those figures have been reduced significantly after the company experienced trade difficulties
- WiseTech now estimates it will earn $450 million in revenue and deliver an EBITDA of $132 million
- Despite the downgrade, the company delivered a 160 per cent increase in net profits in the latest half-year, which it credits to the success of its CargoWise platform
- CargoWise is designed to increase productivity and improve integration, automation and communication within the transportation industry supply chain
- WiseTech’s share price is currently down an even 18 per cent with shares trading for $24.13 each
Software company WiseTech Global (WTC) has dropped more than 17 per cent today after downgrading its full-year guidance.
In the company’s 2019 financial year report it outlined FY20 revenue of between $440-$460 million, an increase of 26-32 per cent from that 2019’s $348.3 million.
It also predicted EBITDA (earnings before interest, taxes, depreciation and amortisation) would grow between 34-42 per cent to $145-$153 million.
However, WiseTech today changed those figures after taking into consideration the impact the coronavirus is having on trade.
“In considering adjustments to our guidance for FY20 we have prudently taken into account the potential impact of COVID-19 on manufacturing and export trade,” Founder and CEO Richard White commented.
The FY20 revenue now sits between $420-$450 million, an increase of 21-29 per cent, and EBITDA of $114-$132 million, a growth of 5-22 per cent.
“The unexpected outbreak of coronavirus (COVID-19) and the effective shutdown of China, a critical driver of the global manufacturing supply chain and a ~16 per cent contributor to global GDP, is creating negative flow-on effects to manufacturing, slowing supply chains and economic trade across the world,” Richard added.
However, the company had 31 per cent increase in 1H20 revenue from $156.7 million to $205.9 million and a NPATA (net profit after tax and amortisation) increase of 22 per cent, from $27.5 million to $33.5 million.
WiseTech also delivered a 160 per cent increase in its net profit from $23.1 million to $59.9 million during the latest half-year.
The company attributes this growth to its CargoWise business and strategic actions.
CargoWise is WiseTech’s single-platform software solution that is designed to increase productivity and improve integration, automation and communication with the supply chain.
According to WiseTech, all top 25 global freight forwarders are customers with the company. 23 of these clients use the CargoWise technology.
This strong customer base means WiseTech has continued to build on the existing CargoWise customer revenue growth of $17 million.
WiseTech’s share price is currently down 18 per cent, with shares trading for $24.13 each at 1:08 pm AEDT.