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Earnings for Bango PLC propel by 29% in the previous year as the first quarter of 2024 maintains impressive momentum.

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Bango PLC, a leading mobile commerce company, marked a 62% revenue growth, reaching $46.1 million in 2023. The company attributes this performance to the acquisition of nine new Digital Vending Machine (DVM) license customers, expanding the total to 18, inclusive of three top US telcos. The firm also welcomed 33 new subscription content provider customers, taking the total to 93.

CEO Paul Larbey attributes the firm’s growth to the strategic focus on seizing the subscription bundling opportunity with the Bango DVM. The strategy has led to the doubling of the customer base and a notable 77% growth in annualised recurring revenue. The technology provided by Bango is relied on by some of the largest companies globally, reinforcing customer acquisition and retention.

Acquisition Impact and Profit Increase

A significant focus of the company has been the integration of the DOCOMO acquisition, which the CEO believes has “materially accelerated” their growth. The integration led to the realisation of $21 million in cost synergies. The challenges faced during the end-of-year integration have now been addressed, setting a clear pathway for further operational and cost synergies in 2024.

The underlying profit (EBITDA) grew to $6.4 million from $5.0 million a year earlier. However, Bango and its NewDeep partner have decided to wind down their joint venture, leading to significant losses. Despite this setback, the firm is optimistic, with no expected significant costs concerning NewDeep in 2024.

The previous year ended with the DVM sales opportunity funnel being seven times larger than a year earlier. This, coupled with a strong first quarter, has enabled the company to sustain good momentum and grow in line with the plan. The first quarter’s revenue reportedly grew more than 20% year-on-year, with annualised recurring revenue at the end of March 2024 increasing to $11 million from $8.8 million at the end of last year.

The Tier-1 US telco customer launched as expected during the quarter, triggering a minimum $2 million annual recurring revenue. The company also secured four new DVM wins and extended a contract with a leading European telco for a further three years. The first launch of telco bundling for a previously announced ‘global technology leader’ also took place during the quarter.

Entering 2024 with increased momentum, an expanded pipeline, and a larger customer base, Bango has clear growth opportunities ahead. The subscriptions market remains robust, with an expanding variety of services beyond just music and movies. The CEO points out that as consumers add subscriptions across all aspects of their lives, this drives the need for a solution to manage these subscriptions, presenting the opportunity for the DVM to become the standard industry platform for subscription bundling. With its strategic focus and robust business model, Bango can potentially capitalise on these emerging trends, posing a potentially promising investment opportunity.