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i3 Verticals Inc (IIIV) Reports Strong Revenue and Adjusted EBITDA Growth in Q4 and Full Fiscal ...

  • Q4 revenue increased by 13.1% and full year revenue grew by 16.5% compared to the previous year.

  • Adjusted EBITDA for Q4 rose by 23.2% and 26.2% for the full year, with margins expanding significantly.

  • Net income for Q4 was $3.4 million, a notable improvement from a net loss of $4.4 million in the same quarter last year.

  • i3 Verticals Inc (NASDAQ:IIIV) projects revenue between $385 million and $410 million and adjusted EBITDA between $109 million and $119 million for fiscal year 2024.

On November 15, 2023, i3 Verticals Inc (NASDAQ:IIIV) released its 8-K filing, announcing its financial results for the fiscal fourth quarter and the full year ended September 30, 2023. The company reported a significant increase in revenue and adjusted EBITDA, along with a positive shift from net loss to net income for the fourth quarter.

Fiscal Performance Highlights

i3 Verticals Inc (NASDAQ:IIIV) saw its fourth-quarter revenue climb to $96.4 million, marking a 13.1% increase from the previous year's quarter. The full-year revenue reached $370.2 million, a 16.5% rise over the prior year. The company's adjusted EBITDA for the fourth quarter was $26.8 million, up by 23.2%, and $100.4 million for the full year, a 26.2% increase. This growth in adjusted EBITDA reflects an improvement in margins, with the adjusted EBITDA margin as a percentage of revenue growing to 27.1% for the year, compared to 25.0% the previous year.

The fourth quarter saw a turnaround in net income, with i3 Verticals Inc (NASDAQ:IIIV) reporting $3.4 million compared to a net loss of $4.4 million in the same quarter last year. However, the company experienced a net loss of $2.7 million for the full fiscal year, which was still a significant improvement from a net loss of $23.2 million for the previous year. Diluted net income per share available to Class A common stock for the fourth quarter was $0.11, a substantial increase from a net loss per share of $0.15 in the prior year's fourth quarter.

Segment and Balance Sheet Analysis

The Software and Services segment of i3 Verticals Inc (NASDAQ:IIIV) reported revenue of $60.1 million for the fourth quarter, while the Merchant Services segment contributed $36.4 million. For the full year, these figures were $233.0 million and $137.3 million, respectively. The company's balance sheet remained solid with an interest coverage ratio of 4.39x and a total leverage ratio of 3.77x as of September 30, 2023.

Management Commentary and 2024 Outlook

Greg Daily, Chairman and CEO of i3 Verticals, expressed satisfaction with the company's performance, stating,

We are pleased to report an excellent finish to fiscal 2023. For three straight years we have set a new record for revenue and adjusted EBITDA every single quarter."

He also highlighted the company's disciplined growth and acquisition strategy and the talent within the organization.

Looking ahead, i3 Verticals Inc (NASDAQ:IIIV) provided an optimistic outlook for the fiscal year ending September 30, 2024, with revenue expected to be between $385 million and $410 million and adjusted EBITDA projected to be between $109 million and $119 million. The company's guidance excludes the impact of future acquisitions and transaction-related costs.

Investor Relations and Non-GAAP Measures

The company will host a conference call to discuss the financial results and operations. Additionally, the earnings release includes non-GAAP financial measures, which management believes provide useful information to investors by offering additional ways to view the company's performance.

i3 Verticals Inc (NASDAQ:IIIV) continues to demonstrate strong financial growth and operational efficiency, as evidenced by its latest earnings report. With a positive outlook for the coming fiscal year, the company appears well-positioned for continued success.

Explore the complete 8-K earnings release (here) from i3 Verticals Inc for further details.

This article first appeared on GuruFocus.

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