Catapult Sports Ltd

ASX:CAT

Catapult Sports Ltd

ASX:CAT
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$3.17 (-5.1%)
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#2
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93
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Forum Topics CAT CAT TradingUpdate

Pinned straw:
mikebrisy
Added 2 months ago

Strawman favourite $CAT has issued a FY26 trading update this morning. (FY end 31-March).

ASX Announcement

My summary and analysis:

The FY26 trading update is broadly positive but carries one meaningful miss: FCF will come in at US$5–6M, well below both the company's own guidance ("to exceed FY25's US$8.6M") and analyst forecasts (~US$11.7M), due to temporary collection delays, reportedly caused by acquisition integration.

On everything else, the update is at or ahead of expectations: ACV growth of 27–28% nudges past consensus, Management EBITDA growth of ~50% confirms strong operating leverage, and the Rule of 40 metric is set to exceed its 1H result.

The ~US$50M closing cash balance with no debt is also a clean outcome following the capital raise and IMPECT acquisition.

My Takeaways: The result appears operationally strong, overall, however FCF is softer given collections underperformance. Not an issue if a one-off, but we'll need to see a strong 1H FY27 collections performance to be comfortable that this isn't an ongoing issue. Integrating acquisitions is a very busy time for any finance function, but it is never good to hear that M&A integration has created a distraction from the core business. Something to watch.

Disc: Held
Longpar5
Added 2 months ago

Thanks for the analysis @mikebrisy

Do you have an estimate of the organic growth in ACV if we strip back revenue estimates for impect and perch?

I feel like it (organic) might be a share under 20%, otherwise they would have called it out. However, if i do the maths i think they might have got there or be close. This is nit picking, the business is in track, but when you're paying up to hold it i think it pays to check for any cracks in the story. I kind of see 20% organic ACV as the benchmark for CAT over recent years.

20% organic would have taken them from Us$101M to US$121M, so question is how much from perch and a few months of impect? If it's less than US$13M we have organic over 20%.

Perch was only a small amount (2.5m ARR on purchase), but I don't think we have impect revenue, it needs to be less than 10m for the half to hit the magical 20%.

Anyone have a feel on this (or shouldn't I care!)

27
mikebrisy
Added 2 months ago

@Longpar5 yes, that's the right question, and I should have covered it.

Just reading off from my model I have:

ACV EOFY25 = US101.2m

ACV EOFY26 = US133-134m

Est. Perch contribution: US$2.5m

Est. IMPECT contribution $US10m (source: Canaccord Genuity 18/11/25 note)

Organic ACV EOFY26 = US$120.5 - US$121.5 m (which ignores the Perch and IMPECT organic contributiions)

Est. Organic ACV Growth = 120.5-121.5 / 101.2 = 19% - 20%

So, I agree with your numbers.

Of course, because Perch and IMPECT are also growing organically (hopefully!) the true % organic growth will be a little lower, but not materially, as the acquisitions are small.

Overall, this remains in line with ACV growth over the last 5 years, which has ranged from c. 18% to c. 23%.

My valuations run with scenarios ranging from 15% in the low cases up to 19% in the high cases, albeit sustained for the long term. So, I consider there is a LOT of headroom from today's SP. The key to look at going forward is whether the acquisitions enable cross-selling, which would be evidenced through accelerating organic ACV growth.

34
Strawman
Added 2 months ago

Great summary @mikebrisy @Longpar5

I've nothing to add really. The business very much seems to be sustaining some good (organic) sales momentum, with a very long run-way ahead. The FCF is a nothing burger in and of itself -- the timing of cash receipts a few weeks either side of an arbitrary reporting period end date is immaterial, especially given their balance sheet.

Sure, maybe there's some shenanigans going on (that's always possible), but I think Occam's Razor would urge us to take it at face value if and until we see a more regular pattern of behaviour.

We are looking at a market value that is nearly 6x ACV, so i don't think shares are necessarily "cheap". But it strikes me as a great company at a fair price.

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