Australian receivables fintech Credit Clear (ASX: CCR) has achieved strong financial performance in its first year of listing, underpinned by a 147% growth in digital revenue as a growing number of businesses convert from traditional debt recovery methods.
In its 2021 annual report released today, the company recorded a 70% year-on-year increase in revenue to $10.98 million with $3.48 million coming from its digital platform. Digital gross profit also rose 147% to $3.16 million.
Credit Clear has developed an end-to-end digital communication and payment management platform that utilises artificial intelligence and machine learning to boost customer engagement and improve debt management.
According to the company, the rate at which clients are converting from traditional debt collection methods to the digital platform increased by a substantial 1,250% in the last year and is continuing its upward trend.
Speaking with Small Caps, Credit Clear founder Lewis Romano said many existing and new clients that switched from traditional debt collection methods found their collections performance improved, as did their customers’ experience.
“We clearly demonstrated the viability of our digital collections business model and its attractiveness to customers in the multi-billion-dollar Australian debt collection industry,” he said.
Even so, traditional revenue also saw year-on-year growth of 34% to $4.9 million, while Credit Clear’s legal division (for late-stage debt recovery services) reported an 85% revenue increase to $2.6 million.
New contract wins
In the last year, Credit Clear added 82 new clients to its books (taking the total number of active clients to 1,021) with a highlight being a four-year contract secured with its first major insurance client, Suncorp (ASX: SUN), worth $1.6 million.
Other major deals were inked with Western Power, Gippsland Water and contracts were extended with Kleenheat Gas and Transurban.
“We also showed that our model has wide application beyond just Australia with Credit Clear attracting strong interest from a number of potential overseas partners and companies seeking to use our world-leading technology,” Mr Romano added.
The year ahead
Credit Clear has been listed on the ASX for almost a year following its $15 million initial public offering.
In the chairman’s letter of the annual report, Gerd Schenkel said he is proud of the company’s achievements in the last year and looks forward to progressing its strategy in both the Australian market and abroad.
“We will continue to roll out a range of innovative solutions in line with our product roadmap.”
“We seek to continue to grow our presence in target industries and geographies, including proactively assessing opportunities in new international markets,” he added.
The United Kingdom will be an immediate target as the company already has resources on-ground there. The United States is being assessed as a second overseas target market in 2022.
Mr Romano said he expects to see further strong growth in the new financial year especially in digital.
“The next year promises to be even more exciting for Credit Clear as our revenues and customer numbers continue to grow and we investigate the potential for overseas expansion. I’m very excited by the outlook and believe Credit Clear’s journey has only just begun.”