Summary
The fund managers believe that Gentrack Group Ltd is positioned for growth due to its strong market presence and innovative solutions in the utility and airport sectors. They emphasize that the company's recent investments in technology will enhance operational efficiency and customer experience. In their opinion, the potential for international expansion is significant, particularly in emerging markets where demand for smart utility solutions is rising. Furthermore, the fund managers highlight that Gentrack's solid financial performance and recurring revenue model provide a stable foundation for future profitability. They express confidence in the management team's strategic vision and ability to navigate market challenges. Overall, the fund managers view Gentrack as a compelling investment opportunity, particularly for those seeking exposure to the growing technology sector in utilities and airports.
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
Source: Trading View
Commentary From The Managers
Wilson Asset Management
31 July 2025
$9.75
Summary
- Gentrack Group Ltd specializes in utility and airport enterprise software for billing, customer, and operations management.
- In July 2025, the company faced a decline in share price due to the loss of an Australian customer contract, influenced by management's decision to withdraw from the process over contract profitability concerns.
- This loss was deemed immaterial to revenue in the upcoming financial years but affected market sentiment regarding competition and contract retention.
- Despite the setback, the company has maintained its medium-term guidance, forecasting revenue growth exceeding 15% CAGR and an EBITDA margin of 15–20% after accounting for development costs.
- Wilson Asset Management believes Gentrack is well positioned to secure several contract opportunities soon, potentially leading to a re-rating.
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Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
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Commentary From The Managers
Wilson Asset Management
31 July 2025
$9.75
- Gentrack Group Ltd specializes in utility and airport enterprise software for billing, customer, and operations management.
- In July 2025, the company faced a decline in share price due to the loss of an Australian customer contract, influenced by management's decision to withdraw from the process over contract profitability concerns.
- This loss was deemed immaterial to revenue in the upcoming financial years but affected market sentiment regarding competition and contract retention.
- Despite the setback, the company has maintained its medium-term guidance, forecasting revenue growth exceeding 15% CAGR and an EBITDA margin of 15–20% after accounting for development costs.
- Wilson Asset Management believes Gentrack is well positioned to secure several contract opportunities soon, potentially leading to a re-rating.
Summary
Ellerston Capital
31 July 2025
$9.75
- Gentrack (GTK AU) was a key detractor, declining 15%.
- GTK is a provider of billing software to utilities, aligning with a global shift to re-platform technology stacks.
- Ellerston Capital believes GTK's software capability and partnership with Salesforce position it well for new customer acquisition.
- The market is growing weary of waiting for new customer wins, as long sales cycles continue.
- Recent negative news includes a potential loss of a customer that represents 2-3% of revenue.
- GTK's first go live of its new G2 cloud stack was delayed, affecting its referenceability for future sales.
- Ellerston Capital continues to believe in the structural opportunity for GTK, but is awaiting contract wins to build conviction.
Summary
Airlie Funds Management
30 June 2025
$11.53
- Airlie Funds Management notes that Gentrack released its 1H25 results, which were below market expectations.
- The headline numbers and FY25 guidance were relatively soft but deemed inconsequential to the long-term thesis.
- Gentrack is characterized as an inherently lumpy business due to significant project work related to client wins and implementations.
- Focus is placed on the trajectory of new client wins and upgrades instead of any single earnings result.
- In 1H25, Gentrack secured a new logo with Utility Warehouse, a strong player in the UK utility sector.
- The company entered into multiple scoping arrangements with new customers, indicating a strong likelihood of deal closures in 2H25.
- This positions Gentrack well for FY26.
- Despite the soft FY25 guidance, Gentrack’s share price increased by 14% over the quarter, reflecting positive sentiment.
- Overall, Airlie Funds Management continues to hold its position in Gentrack, reflecting confidence in its long-term potential.
Summary
Airlie Funds Management
31 Jan 2025
$11.55
- Airlie Funds Management continues to hold a significant position in Gentrack, a global provider of enterprise software for utilities and airports.
- The Fund’s investment philosophy focuses on fundamental research to identify mispricings, with Gentrack being one of the largest holdings benefiting from the energy transition thematic.
- Gentrack has been a strong contributor to the Fund's performance since inception.
- For utility customers, Gentrack offers mission-critical software that manages customer information, billing, and energy management, resulting in low customer churn.
- Upgrading Gentrack's software is a significant project for utilities, costing between $50 million and $250 million and taking 12 to 24 months to implement.
- This long upgrade cycle effectively locks in customers for a decade, creating predictable revenue streams.
- Gentrack has been operational for over 35 years, demonstrating durability in a high-barrier industry.
- The energy transition is increasing the complexity of energy grids, creating opportunities for Gentrack and other specialist providers.
- In core markets like Australia, New Zealand, and the UK, Gentrack has gained market share from larger incumbents like SAP and Oracle.
- The management team, led by CEO Gary Miles, has a strong track record in enterprise software.
- Recent challenges in the UK market due to customer closures were viewed as temporary, leading to a purchasing opportunity at a low valuation.
- Gentrack has seen an 87% increase in 2024, supported by strong financial results and profit margin expansion.
- Despite trading at 33x FY25 EBITDA, profit margins remain below historical levels, suggesting potential for operating leverage.
- Airlie Funds Management sees compelling long-term value in Gentrack, maintaining it as a core holding in the Fund.
Summary
Airlie Funds Management
31 Dec 2024
$11.59
- Gentrack released a strong FY24 result, marked by 26% revenue growth and significant free cash flow generation.
- Underlying profit margin expansion indicates management's ability to restore profit margins to historical levels.
- Airlie Funds Management's investment philosophy focuses on fundamental research and identifying mispricings.
- Gentrack operates in the energy transition sector, providing enterprise software to utilities and airports.
- The company has been a strong contributor to the Fund's performance since inception.
- Gentrack’s software is mission-critical, leading to low customer churn due to high switching costs.
- Utility software upgrades are costly and take significant time, creating predictable revenue streams.
- Gentrack has been operational for over 35 years, showcasing durability in the software industry.
- The energy transition is increasing the complexity of energy grids, necessitating software upgrades.
- Gentrack has gained market share in Australia, New Zealand, and the UK, with significant opportunities ahead.
- CEO Gary Miles has an impressive background in enterprise software, enhancing Gentrack's management team.
- Recent customer closures in the UK were viewed as temporary, leading to the investment in Gentrack.
- Gentrack's stock rose 87% in 2024 following strong financial results, reinforcing the margin recovery thesis.
- Despite trading at around 33x FY25 EBITDA, profit margins remain below historical levels, indicating potential for operating leverage.
- Airlie Funds Management continues to see compelling long-term value in Gentrack, maintaining it as a core holding in the Fund.
Summary
Firetrail Investments
30 Nov 2024
$12.90
- Gentrack Group Ltd outperformed following their FY 2024 result.
- Topline revenue was a 5% beat relative to market expectations.
- EBITDA (excluding non-cash long-term incentives) beat by 13%.
- Gentrack is well-positioned to benefit from energy and water utilities looking to re-platform.
- There is a solid contract pipeline in both existing and new markets.
- Firetrail Investments continues to hold because of these positive indicators.
Summary
Wilson Asset Management
30 Nov 2024
$12.90
- Gentrack Group is a technology provider to major energy and water companies.
- Reported full year results for 30 September 2024 with 25.5% year-on-year revenue growth.
- Growth driven by strong performance in utilities and airports divisions, exceeding market expectations.
- Wilson Asset Management remains positive on Gentrack Group and its future outlook.
- Company's strong cash position enables potential for earnings accretive acquisitions.
Summary
Forager Funds
30 June 2024
$9.43
- Forager Funds notes Gentrack (GTK) has shown strong performance in the utilities and airports software sector.
- Continued profit upgrades are attributed to a strong management team.
- Revenue forecasts for the financial year ending September 2024 have increased from $160 million to approximately $200 million.
- Gentrack has effectively introduced new products, such as g2.0 in partnership with Salesforce.
- Expansion into new markets includes contracts in Saudi Arabia and Singapore.
- New offerings and high-stakes implementation capabilities enhance Gentrack's growth potential.
- In response to substantial share price appreciation, Forager Funds has reduced its investment, cutting portfolio exposure by over half.
- Gentrack's share price has appreciated by 140% over the 2024 financial year, contributing 3.8% to portfolio performance.
Summary
Airlie Funds Management
30 June 2024
$9.43
- Gentrack was the Fund’s strongest performer over the year, contributing +6.8% to gross Fund performance.
- Gentrack provides customer billing software to the utility sector and customer management software to the airport sector.
- Airlie Funds Management likes businesses that sell ‘mission-critical’ enterprise software due to low customer churn.
- Low customer churn creates resilient, annuity-style revenues.
- Prior to purchase, Gentrack faced challenges with customer closures linked to regulatory issues in the UK, impacting profit margins.
- Airlie Funds Management viewed these issues as mostly temporary and increased their position on signs of improving revenue growth and margin recovery.
- Despite the stock's strong performance, Gentrack has significant growth potential as utilities upgrade systems for the energy transition.
- Profit margins are expected to return towards historical levels.
Summary
Airlie Funds Management
31 Mar 2024
$7.90
- Airlie Funds Management highlights Gentrack as the Fund’s strongest performer, contributing +5.7% to gross Fund performance over the year.
- Gentrack is recognized as a global tech company providing customer billing software for the utility sector and customer management software for the airport sector.
- The Fund favors businesses that sell mission-critical enterprise software, noting low customer churn due to the high costs and disruptions associated with switching providers.
- This low churn results in resilient, annuity-style revenues for Gentrack.
- Prior to acquisition, Gentrack faced challenges from customer closures linked to regulatory issues in the UK, leading to reduced profit margins.
- Airlie Funds Management viewed these challenges as temporary and increased their position based on signs of improving revenue growth and margin recovery.
- Despite a strong performance, Gentrack is seen to have a long pipeline for growth as utilities modernize systems to adapt to the energy transition.
- Profit margins are expected to recover towards historical levels.
Summary
Forager Funds
31 Mar 2024
$7.90
- Forager Funds updates their investment thesis on Gentrack Group Ltd, a utilities software company listed on the ASX and NZX.
- Gentrack has experienced a fivefold share-price increase over the past 18 months.
- Its market capitalisation has risen from less than NZ$150 million to approaching NZ$1 billion.
- The company achieved a significant turnaround in profitability, moving from a NZ$3 million loss before tax in 2022 to a NZ$15 million profit in 2023.
- Forager Funds expects Gentrack’s profit to at least double over the next three years.
- Forager Funds continues to hold Gentrack due to its improved growth prospects and profitability.
Summary
Naos Asset Management
31 Dec 2023
$6.20
- GTK's FY23 results showed a revenue guidance upgrade for FY24.
- Underlying revenue growth exceeded 40% when excluding impacts from customer defaults.
- Two years ago, GTK shares were near $1, raising concerns about the need for significant investment.
- The current management has successfully improved GTK's market perception.
- G2.0 is a competitive offering with a strong implementation track record, evidenced by a recent deal with Genesis Energy.
- GTK has yet to experience a failed billing implementation, a critical success factor for enterprise software companies.
- Partnership with Salesforce enhances GTK's offerings by combining best-in-class billing and CRM functionalities.
- The market opportunity is significant, as many utilities are seeking to upgrade outdated billing systems to meet evolving consumer needs.
- GTK is no longer a core investment for Naos Asset Management, but it remains under close observation for future growth potential.
Summary
Airlie Funds Management
31 Dec 2023
$6.20
- Gentrack released strong FY23 results with revenue growth of 35% and profit growth of 185%.
- Very strong free cash flow generation reported.
- Upgraded FY24 revenue guidance indicates robust underlying growth.
- Airlie Funds Management continues to like Gentrack for its ‘mission critical’ software, which is sticky and fosters resilient annuity-style revenues.
- Despite trading on a seemingly expensive earnings multiple, Gentrack is viewed as currently underearning.
- Profit margins are below historical levels; further expansion in these margins could drive strong earnings growth.
- Airlie Funds Management believes this potential growth justifies the current valuation of Gentrack.
Summary
Naos Asset Management
30 June 2023
$3.91
- GTK's 1H FY23 results showed strong performance with management providing upgraded guidance.
- Share price increase from $1.25 in August 2022 to $3.86.
- Standout EBITDA of NZD $16 million, with a margin returning to 19%, exceeding management’s target.
- Net cash balance reported at $41.9 million, indicating strong financial health.
- Results driven by loyalty of legacy customer Bulb Energy, showcasing management's cost control and profitable growth.
- Management upgraded FY23 revenue guidance to $157-$160 million, expecting EBITDA around $22 million.
- GTK's expenses are fully allocated to R&D, providing an accurate cash earnings representation.
- Veovo division saw 27% revenue growth, indicating recovery and potential expansion.
- Management noted a pipeline that has more than doubled, reflecting increased demand in airports sector.
- Long-term focus on scaling Veovo business to enhance competitiveness and customer solutions.
- Renewable energy transformation presents a significant opportunity for GTK to upgrade utility billing platforms.
- Recent operations launched in South-East Asia expanding market reach after wins in Singapore.
- Key focus on upgrading existing clients to Gentrack 2.0 software platform for better efficiency.
- GTK has a strong track record in system implementations, which is appealing to risk-averse customers.
- Importance of having the right personnel and systems in place to manage new work effectively.
Summary
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
Frequently Asked Questions
Who has invested in Gentrack Group Ltd (ASX:GTK)?
Fund managers including Naos Asset Management, Forager Funds, Airlie Funds Management, Firetrail Investments , Wilson Asset Management and Ellerston Capital have invested in Gentrack Group Ltd (ASX:GTK).
Why have investment managers invested in Gentrack Group Ltd (ASX:GTK)?
Fund managers are investing in Gentrack Group Ltd (GTK) due to its strong financial performance, innovative software solutions, and significant market opportunities in the utilities and airport sectors. Recent quarterly reports highlight several key factors driving this interest:
1. **Consistent Profit Growth**: GTK has demonstrated impressive revenue and profit growth, with forecasts indicating substantial increases in revenue, driven by a robust demand for its G2.0 software solutions. This growth trajectory positions GTK favorably within the competitive landscape.
2. **Strong Management Team**: Under CEO Gary Miles, Gentrack has shown a commitment to innovation and operational excellence. The management's ability to execute on strategic goals and maintain a strong track record of successful software implementations enhances investor confidence.
3. **Market Demand for Upgrades**: The transition to renewable energy is creating a pressing need for utility companies to upgrade their outdated billing systems. Gentrack's software is seen as essential for utilities navigating this complex landscape, providing a stable revenue stream due to low customer churn.
4. **Partnerships and Expanding Reach**: Collaborations with industry leaders like Salesforce enhance Gentrack's offerings, making it a more attractive option for utility providers looking to modernize their systems. The company is also expanding into new geographic markets, further increasing its growth potential.
5. **Resilient Business Model**: The nature of Gentrack's services—mission-critical software—ensures that clients are less likely to switch providers, leading to predictable and recurring revenue.
Overall, fund managers view Gentrack as a compelling investment opportunity due to its strong fundamentals, strategic positioning in a growing market, and the potential for continued growth in profitability.
What happened to Gentrack Group Ltd (ASX:GTK)?
In July 2025, fund managers from Wilson Asset Management and Ellerston Capital shared insights on Gentrack Group Ltd (GTK AU), whose share price was around $9.75. Wilson Asset Management noted a decline in share price due to the loss of an Australian customer contract, attributed to management's withdrawal over profitability concerns. Despite this setback, Gentrack maintained its medium-term guidance, projecting over 15% CAGR in revenue and a 15-20% EBITDA margin. Ellerston Capital highlighted GTK's challenges, including a 15% decline and delays in customer wins, despite a growing market for utility billing software and a promising partnership with Salesforce. Both firms recognize the potential for Gentrack to secure new contracts, which could drive a re-rating of its stock.