Boku's (LON:BOKU) H1 trading update confirms the company continues to see strong growth in total processed value (TPV) and revenues. Positive EBITDA for H118 supports our forecast for Boku to report its first full year of EBITDA profitability in FY18. The company anticipates meeting earnings expectations for FY18. We see the potential for revenue upside in FY18 to be reinvested in longer-term growth opportunities, providing support to the share price. We maintain our forecasts pending interims in September.
Transaction volumes drive strong revenue growth
Boku processed volumes worth $1.5bn in H118 (+153% y-o-y, +42% h-o-h) and expects to report revenues of $16.5-17.0m for H118 (vs $10.2m in H117 and $14.2m in H217). As we have previously noted, revenue growth lags TPV growth due to the changing mix of transaction types. Adjusted EBITDA was positive for H118, as was the case in H217. By the end of H118, monthly active users hit 10.3m, up from 4.7m at the end of H117 and 8.1m at the end of FY17. Cash at the end of H118 stood at $30m, and averaged $23.1m during June. This compares to our end FY18 forecast of $23.9m, and reported cash of $18.7m at the end of FY17.
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