Novatti is going from strength to strength as it reaches the $10 million quarterly revenue milestone for the first time following its acquisition of ATX.

Multi-channel payments company Novatti (ASX:NOV) has just had its strongest ever quarterly result, after reporting a record $10.4 million in sales revenue for Q3.

Achieving the $10m mark was a key milestone for Novatti, reflecting the immediate effect the ATX acquisition has had on the business.

Even without the addition of ATX, Novatti’s existing business continued to show strong growth, with quarterly sales revenue of $6.8m, a new record in its own right and a 65% increase year-on-year.

Novatti’s processing business also continued to provide a strong platform for the company’s overall growth, with quarterly sales revenue of $5.3m excluding ATX, an increase of 73% year-on-year.

“These results highlight Novatti’s ability to continue to deliver against its main objective for this financial year, being topline revenue growth, while also reaffirming the strong business case for the acquisition of ATX,” commented Novatti CEO, Peter Cook.


Strong outlook ahead

Looking forward, Novatti says its focus will be on delivering topline revenue growth, while seeking to drive increasing returns as the company scales.

“While Novatti’s overarching objective continues to be driving topline revenue growth, achieving positive cash flow is a significant milestone in the development of Novatti’s individual businesses,” says Cook.

“It will be an increasing focus going forward to deliver a return on our recent investment in growth.”

Cook also said that Novatti will continue to focus on delivering against its growth strategy by driving growth in current operations, and establishing new and expanded markets.

“We continue to see growing macro-level demand for our services. The global push to digital payments continues to accelerate post-COVID and, having established our global payments ecosystem and operating base, we are in a strong position to grow with this demand,” he said.


ATX acquisition and Reckon integration

During the March quarter, ATX was successfully integrated into Novatti. Based in Malaysia, ATX provides e-wallet providers, traditional retail stores and kiosks with digital payment services, such as third-party bill and product payments.

The acquisition of ATX has had an instant positive impact on Novatti’s business, including contributing more than $3.5m in sales revenue for the March quarter.

The quarter also saw Novatti reach an agreement with leading accounting software platform, Reckon Limited, to integrate Novatti’s payment solutions into their products.

This follows Novatti’s strategic investment in Reckon in July last year, and the two companies have since been working collaboratively to identify opportunities to add value to their more than 114,000 users.

New and expanded markets

Novatti’s Acquiring business enables merchants, particularly those in e-commerce and with sophisticated billing and embedded payment needs, to accept payment from consumers, including through credit cards, direct debits, and other mechanisms such as Alipay and WeChat Pay.

The business has a rapidly growing customer base, including a number of financial services and business customers of Novatti’s other business units, who have sought additional services.

This is reflected in the strong growth of Acquiring’s quarterly sales revenue, which grew 189% on the previous quarter.

Elsewhere, Novatti has worked to bring Emersion to the US market. This has involved building a sales and technical team, and localising several aspects of the product suite.

Initial clients in the US and Canada have been signed, with Mobile Virtual Network Operator signing a five-year contract for approximately $1m of revenue.

In Europe, Novatti has a business development and compliance team located from its office in Cyprus.

Leveraging this local presence, the company has been able to drive strong growth for its existing Flexepin voucher business and cross border settlements.


Digital assets

Novatti believes that digital assets, such as stablecoins, present an enormous growth opportunity for the payments sector going forward, as they leverage digital technologies to provide a more efficient and cost effective means of payment.

The company has initiated several projects to increase its exposure to any future growth in demand for these products, and to ensure it remains at the cutting edge of payments innovation.

Projects initiated so far include Australia’s first Visa-powered crypto payment card through Cryptospend, and separately enabling businesses to accept crypto payments in a compliant and secure method where funds are settled in AUD.


This article was developed in collaboration with Novatti, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.