The Nuix Ltd (ASX: NXL) share price has exploded out of the blocks on Monday, currently trading more than 20% higher at $4.21 apiece.
Investors are piking into Nuix after the company reported its FY24 results.
Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is slightly in the red at the time of publication.
Let's see what the company posted.
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Nuix share price spikes on strong profit growth
The key takeouts from the quarter include the following points:
- Annualised Contract Value (ACV) increased by 14% to $211.5 million
- Statutory revenue was 20.9% year over year to $220.6 million
- Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) jumped 38.7% to $64.4 million
- Statutory net profit up more than 100% year over year to $5 million in FY24
- Free cash flow increased more than 171% to a positive $11.9 million
What else happened in FY24?
The Nuix share price had a solid period in FY24. One of the major highlights of the year was the company's rollout of Nuix Neo, a data analytics platform.
The ACV attributable to Nuix Neo soared by 195% over the year, reflecting the pace of customer adoption.
Overall, company ACV was up 14% to $211 million, which translated into 38% growth in pre-tax earnings compared to last year.
Nuix's customer base in North America played a crucial role in driving this growth, with net dollar retention (NDR) rising by around 370 basis points to 113%.
Meanwhile, the proportion of revenue allocated as "multi-year deals" increased to 31%.
By the end of the year, it had $38 million in cash on hand, up 29% year over year and 60% compared to the first half.
What did management say?
Nuix CEO Jonathan Rubinsztein commented on the stellar performance:
At the start of the financial year, we set ourselves ambitious strategic objectives relating to new product rollout and financial performance. We have met the strategic objectives we set, and in several cases, exceeded them.
FY24 represents a year of remarkable delivery by the Nuix team. The development and launch of Nuix Neo, along with three related use case solutions, is an outstanding achievement. Nuix Neo is an innovative step change in our customer offering and provides the foundation for an exciting growth trajectory for Nuix. Customer interest and take up has been particularly pleasing, as evidenced by the strong growth in Nuix Neo ACV over the year.
Rubinsztein also said the company was focused on investing for the future:
We are well-positioned for the next stages of growth. In the coming financial year we will continue to invest in our technology, further evolving our offering in line with our strategic vision. The technology and financial base established in FY24 provides a solid foundation for growth into FY25 and beyond.
What's next?
Looking ahead to FY25, Nuix aims to continue its growth trajectory with a target of approximately 15% ACV growth. This may impact the Nuix share price.
It also wants to continue building on the momentum of the Nuix Neo launch, further expanding its customer offerings.
In FY25, management expects "revenue growth to exceed operating cost growth" again. In other words, it expects 1% in sales growth to produce more than 1% in operating profit growth.
This translates to 'operating leverage', where a dollar of sales growth creates more than a dollar of operating profit.
Nuix also expects to be free cash flow positive for the year.
Nuix share price snapshot
The Nuix share price has been in an upward trend over the past 12 months.
Over that time, the company's stock is up more than 149%, a major outperformance over the benchmark.
