Scoop has an Ethical Paywall
License needed for work use Register

Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


Pushpay expects to break-even by year-end

By Pattrick Smellie

Nov. 7 (BusinessDesk) - Digital church collection plate operator Pushpay says it expects to break-even for the first time in December this year and to post its first earnings before interest, tax, depreciation, amortisation and currency adjustments in the year to March 31, 2019.

The NZX-listed, US-headquartered software-as-a-service company is growing from a strategy targeting medium to large-sized US churches. It has 55 of the largest 100 US churches on its books, including the largest, which boasts 51,900 weekly church attendees, it told investors today. Executives said one of its main competitors, Blackboard, was focusing more on "the Catholic sector" whereas Pushpay was making inroads with Protestant churches.

The company lost US$4.4 million in the six months to Sept 30, compared with a US$12.5 million loss in the same period last year. Revenue of US$44 million showed an increase of 48 percent on the same period a year earlier, consistent with common SaaS strategy to invest in sales growth ahead of profitability.

Pushpay expects full-year revenue of between US$97.5 million and US$100.5 million.

Chief executive Chris Heaslip said any future positive operating earnings would come in part from a strategy to improve margins, as well as from increasing market share in "the US faith sector".

Gross margin is expected to increase to more than 60 percent in the second half of the current financial year, from 54 percent in the same period last year.

Once it breaks even, Pushpay will do away with quarterly reporting of key metrics, following investor and analyst feedback, said Heaslip. The company has also concluded that one of its benchmarks, annualised committed monthly revenue, is no longer useful because of the seasonal nature of giving patterns, and will not be reported in future, he said.

Advertisement - scroll to continue reading

Are you getting our free newsletter?

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.

The company, which listed in 2014, declined comment on reports that founder-shareholder Eliot Crowther's ex-wife, Dorette Banghart, is suing Crowther over the purchase of her share of the couple's stake in Pushpay.

The National Business Review reported last week that around mid-2017, while the couple were discussing divorce proceedings, Banghart alleges Crowther warned her that, based on inside knowledge, Pushpay shares were about to "go drastically down" and that she should accept $5 million for her stake.

Crowther sold his 9.03 percent stake in Pushpay for $100 million on June 19.

A company spokeswoman told BusinessDesk the issue was private and declined to comment on whether Pushpay might be joined to Banghart's proceedings or whether the company anticipated taking steps to protect its brand, given its exposure to religious organisations.

Pushpay shares were trading at $3.64, down 1.9 percent on last night's closing price, in early afternoon trading on the NZX today.


© Scoop Media

Advertisement - scroll to continue reading
Business Headlines | Sci-Tech Headlines

FMA: MAS To Pay $2.1M Penalty For Making False Representations

Following proceedings brought by the FMA, MAS has been ordered to pay a $2.1M penalty for making false and/or misleading representations to some customers. MAS admitted failing to correctly apply multi-policy discounts and no claims bonus discounts to some customers, failing to correctly apply inflation adjustments on some customer policies, and miscalculating benefit payments.More

IAG: Call On New Government To Prioritise Flood Resilience

The economic toll of our summer of storms continues to mount, with insurance payouts now topping $1B, second only to the Christchurch earthquakes. AMI, State, & NZI have released the latest Wild Weather Tracker, which reveals 51,000 claims for the North Island floods & Cyclone Gabrielle, of which 99% (motor), 97% (contents), and 93% (home) of claims have now been settled. More


Join Our Free Newsletter

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.