(Headline abbreviated, original headline: Pushpay shares rise as cost-cutting upgrades earnings guidance)
By Victoria Young
Sept. 20 (BusinessDesk) - Pushpay Holdings shares rise 2.7 percent after it lifted earnings guidance for 2020 by stripping out costs.
The digital church collection payment operator estimates earnings before interest, tax, depreciation, amortisation and foreign currency movements for the year ending March 31 2020 will come in at US$23-25 million. Earlier guidance predicted earnings of US$18.5-20.5 million.
This is despite fewer new customers in 2020, which has seen Pushpay today lower operating revenue guidance to US$121-124 million from US$122.5-125.5 million.
The shares rose to a two-month high $3.49, taking this year's gain to about 13 percent.
The lower end of the operating revenue guidance is still 26 percent up from the US$95.9 million it posted for 2019, which was a 42 percent improvement on the year prior.
“As previously indicated at our 2019 annual meeting, new customer acquisition over the start of the financial year was lower than the previous year. We have subsequently adjusted our operating revenue guidance range to reflect this,” Pushpay’s chief executive Bruce Gordon said.
Pushpay said costs were expected rise by mid-single digits, but efficiencies and changes in lease accounting standards meant that expenses will be lower year-on-year.
The company said gross margin is in line with expectations at more than 63 percent and it anticipates total processing volume of US$4.8-5.0 billion for the year ending 31 March 2020.
Pushpay said it will announce interim results on Nov. 6.