ReadyTech Holdings shares fell 6.96% to A$1.47 after executives outlined a cautious outlook for fiscal 2027, despite reporting a 2.6% revenue increase in fiscal 2026.
Total revenue reached A$125 million for the year ended June 30, 2026, while underlying EBITDA rose to A$35 million, translating to a margin of 28.1%. Subscription revenue accounted for 83% of the total at A$103.8 million, while services revenue contributed A$21.2 million. Underlying cash EBITDA declined to A$15.8 million from A$19.6 million in fiscal 2025, with margins contracting to 12.6% from 16%.
The company’s cash conversion improved to 108% from 85% a year earlier, supported by A$27.5 million in cash on hand and adjusted net debt of A$32.5 million. Net debt to EBITDA stood at approximately 1.0 times, with interest cover at 8.8 times. Gross profit margin remained robust at 50% for the trailing twelve months, while return on equity was 9%.
ReadyTech guided fiscal 2027 revenue to A$128 million–A$132 million, implying growth of 2%–6% from fiscal 2026. Underlying cash EBITDA margin is expected to improve to 15%–17%, up from 12.6% in the prior year.
Cost-cutting measures removed 62 roles during the year, delivering A$6.5 million in annualized savings. An additional A$3.3 million in savings is anticipated in fiscal 2027. The company’s enterprise pipeline reached a record A$39.8 million, including A$16 million in first-year subscription opportunities and A$23.8 million in services.
Workforce revenue grew 10.4% to A$38.1 million, driven by a 25.4% increase in Ready Workforce subscription revenue. Work Pathways revenue was broadly flat at A$43.1 million, while Government and Justice revenue held steady at A$43.8 million.
AI initiatives under the Orqestra platform recorded 33 live integrations and more than 5,000 tasks executed. Engineering productivity improved where AI-enabled super squads were deployed, generating three to four times the development velocity. AI support drafts over 85% of customer responses, and an AI screening assistant is used by approximately 80% of customers, reducing time to placement by over 20%.
ReadyTech operates in regulated markets with deep domain complexity, managing core systems of record and workflows with thousands of industry-specific rules and edge cases, according to CEO Marc Washbourne. The company’s Rule of 40 performance will increasingly guide investment decisions, CFO Bryce Thompson noted.
