News & Media

News & Media

26th April 2022

Credit Clear roars towards cashflow break-even with global market conditions ‘the best in 20 years’

The company’s Q3 results show its platform is ideally suited to a next major up cycle in debt collection services.

Payments technology company Credit Clear (ASX:CCR) has brought forward the time-line for its push towards cash-flow breakeven, as it combines surging revenues with improved operational efficiencies.

The accelerating momentum was confirmed in this morning’s Q3 trading update, where CCR flagged record quarterly revenues of $6.1m.

The figures included a $2.9m of income in March alone, which was a monthly record, while the Q3 total represented an impressive 88% uplift on the previous quarter.

The results mark validation of CCR’s broader business strategy, which included the FY22 acquisition of debt recovery solutions provider ARMA.

The company has also expanded into global markets through a deal to provide its receivables management software platform to multinational contact centre service provider Techub.

In light of those positive shifts, CEO Andrew Smith and the Board have made it clear; CCR is now on track to reach cash-flow break-even by July this year.

Turnaround story

Speaking with Stockhead, Smith – who came on as Credit Clear CEO following the ARMA acquisition – highlighted that the new July target is a result of strong execution in both top-line revenues and cost management.

ARMA is a debt, commercial and consumer recovery agency whose clients include Suncorp Group, CoatesHire and numerous New South Wales government departments.

Already, Smith said that by joining forces to two companies are achieving strong momentum in both existing revenues and the potential pipeline of new clients.

“It’s been a case of making significant cost reductions in areas we didn’t need, while growing revenues through the ARMA deal,” Smith said.

The ARMA integration has already “exceeded expectations” CCR said in its Q3 results, with almost 300,000 customer accounts already loaded into the combined platform and outperformance across all key metrics.

“So in effect we’ve brought in a performing business, and got rid of under-performing divisions.”

“That’s had a dramatic impact on profitabl. And now, once all the new cost reductions flow through it’s pretty clear that we’re going to be at that break-even point very early in new financial year.”

Macro tailwinds

Smith said the Credit Clear management team now has a ‘good problem’ to solve – how to scale up the sales team and operational divisions fast enough to meet growing demand.

Through its strategy, the company is solving a key market pain point in debt collection services.

It’s platform is built to benefit from a “fundamental transformation” taking place in the collections industry, the company said.

That shift is “accelerating the need for a hybrid collection service offering – a digital service supported by traditional market knowledge with an increasing focus on technology, digital solutions and customer experience”.

And Smith highlighted that as the global economy emerges from the pandemic, interest rates rise and financial conditions continue to tighten, a company such as Credit Clear is perfectly positioned to build market share.

As an early indicator of that shift, Smith highlighted that rapidly changing sentiment around the once red-hot BNPL sector.

Having already sold off sharply, listed companies in the space are now coming under even more pressure with increasingly problematic bad-debt metrics in their latest trading updates.

“Their arrears and bad debts are going up, and I think that talks to the fact this market and the economy – although unemployment rates are low, inflation is going up,” Smith noted.

“So interest rates are going up, and I think there’s going to be some pain in the market and people are going to need assistance on their debt management.”

In that environment, tech-based debt restructuring platforms are on “a new upswing”, Smith said.

“Certainly I’ve never seen market conditions like this in my 20 years working in industry,” Smith said.

This article was first published on

Credit Clear roars towards cashflow break-even with global market conditions ‘the best in 20 years’

Latest Credit Clear announcements