itim Group (LON:ITIM), the innovative SaaS and services provider transforming the retail landscape, has delivered a stellar FY24 trading update, prompting Zeus Capital to upgrade its forecasts. The company’s robust financial performance, driven by key contract wins and revenue growth, has significantly exceeded expectations, setting a strong foundation for future growth.
Outperforming Expectations in FY24
itim reported revenues of £17.9m, a 5% increase over expectations and up from £16.1m the previous year. More impressively, EBITDA surged 56% above forecasts to reach £2.5m, while the group moved into profitability, reporting a positive PBT of £0.2m—a dramatic turnaround from the previous year’s £1.1m loss. This success underscores the company’s strong operational gearing and effective cost management.
Zeus Capital’s analysts were particularly encouraged by itim’s improved cash position, which stood at £3.8m at year-end—well ahead of previous estimates of £2.1m.
Key Contracts Drive Growth
The company’s performance was bolstered by significant contract wins and extensions in the second half of the year. A notable highlight was a five-year extension with The Entertainer, which sees base subscription rates rising by more than 30%. This follows last year’s major contract win with a leading fashion retailer and a renewed five-year agreement with Majestic Wine.
These deals further validate itim’s UNIFY platform as a trusted solution for retailers looking to enhance their omnichannel capabilities.
Forecasts Upgraded – Strong Upside Potential
Following the positive update, Zeus Capital has raised its FY25 revenue forecasts by 2.6%, resulting in a 5.2% increase in expected EPS. For the first time, the firm has also introduced FY26 estimates, reflecting continued revenue growth and improved profitability.
Zeus analysts John Cummins and Charlie Cullen noted:
“Today’s announcement continues a strong run of results for itim, with FY24 results well ahead of our expectations and a series of very encouraging contract wins and extensions.”
Trading at a 68% discount to its peers on a FY25 EV/Revenue multiple of just 0.5x, itim’s current valuation presents a compelling investment opportunity.
On a Final Note
itim Group’s impressive turnaround in FY24 and its growing list of high-profile contracts position the company for sustained growth. With strong financials, positive cash flow, and upgraded forecasts, the company is well on track to strengthen its market position in the retail technology space. Investors and analysts alike will be watching closely as itim continues to execute on its ambitious growth plans.
