Wrkr Limited (ASX: WRK) has posted a steady but uneventful second quarter for FY25, with financial metrics largely flat. However, the bigger picture tells a more compelling story, as the company continues laying the foundation for a period of accelerated revenue growth. With key client onboarding and regulatory tailwinds expected to drive major increases in transaction volumes, Wrkr’s short-term financials mask the progress being made in readiness for a transformational shift in its business.
For the quarter ending 31 December 2024, Wrkr reported cash receipts of $1.9 million, a marginal 1% decline on the prior corresponding period. Net operating cash outflows stood at $418,000, reflecting continued investment in platform development, staff expansion, and its growing international presence. The company ended the quarter with $7.2 million in cash, providing a financial runway of nearly seven quarters at current spending levels. While the numbers may not show immediate returns, Wrkr’s management remains confident that the investments made now will translate into meaningful revenue growth over the next 18 months.
Building for the Future: The Quarter of Investment
The December quarter was not about short-term results but rather about preparing for a fundamental shift in Wrkr’s business model. The company increased its headcount, adding five key hires, including a Chief Operating Officer and a Senior Cyber Security Analyst, in anticipation of the major expansion in transaction processing volumes. It also recorded $622,000 in capitalised software development spend, its second-highest quarter on record.
Alongside its domestic operations, Wrkr also made progress on its Hong Kong expansion, with its compliance platform expected to go live in Q3. Meanwhile, it continued working closely with MUFG Retirement Solutions (formerly Link Group) to integrate major super funds onto the Wrkr PAY platform, a move that is expected to unlock significant revenue opportunities once full migration is completed.
CEO Trent Lund reinforced Wrkr’s focus on execution, stating:
“The groundwork we are laying today will translate into a significant ramp-up in revenue as key superannuation clients migrate to our platform. Our focus remains on execution and ensuring we are fully prepared for the surge in transactions as regulatory changes take effect.”
CEO Trent Lund
MUFG and Payday Super: The Game Changers
Two major catalysts underpin Wrkr’s future growth strategy. The first is the migration of MUFG Retirement Solutions clients, which is expected to drive a step-change in revenue. Wrkr is set to onboard REST Super’s 1.4 million active members onto its platform in FY26, with further potential to secure HOSTPLUS (1.8 million members) and AustralianSuper (3.2 million members). If these clients fully migrate, it could translate into an annual revenue opportunity of $12–13.5 million. The implementation timeline suggests a significant uplift in revenue from late FY25 into FY26, particularly as pilot programs move into full-scale deployment.
The second major growth driver is the upcoming Payday Super reform, scheduled for July 2026. Under the new legislation, superannuation contributions will need to be processed at the same time as salary payments, rather than quarterly. This change is expected to dramatically increase the frequency of superannuation transactions, potentially doubling or tripling Wrkr’s transaction volumes. Wrkr has positioned itself at the forefront of this transition, ensuring its payroll and superannuation integration solutions are fully optimised for the new regulatory framework.
Financial Position: Ready for Growth
While Wrkr remains in investment mode, its financial position remains solid. The company ended the quarter with $7.2 million in cash, a buffer that allows it to execute its strategic initiatives without immediate concerns about capital raising. Wrkr’s cost-to-income ratio has improved by 17% over the past 12 months, a sign that management is effectively balancing investment and cost control. Cash inflows are expected to accelerate in the second half of FY25 as key project milestones are completed and new revenue streams come online.
Research Suggests Significant Upside
A recent research note from RaaS Research highlighted that Wrkr’s current share price of $0.052 does not fully reflect its medium-term growth potential. The firm maintained its DCF valuation at $0.078 per share, implying a potential upside of 50%. The valuation is underpinned by assumptions around MUFG client migration, Payday Super, and an eventual increase in direct client acquisitions. Analysts noted that Wrkr’s ability to capitalise on these opportunities could significantly alter its revenue trajectory, with projections of $30 million in revenue by FY27, up from $9.6 million in FY24.
Looking Ahead: A Pivotal 18 Months
While the latest quarterly results may appear unremarkable, they do not tell the full story of Wrkr’s transformation. The company is in the final stages of multiple projects that, once completed, are expected to unlock significant increases in transaction volumes and recurring revenue. With regulatory changes acting as a tailwind and major superannuation funds expected to migrate onto its platform, Wrkr is on the cusp of a high-growth phase.
Investors seeking short-term results may need patience, but for those with a longer-term view, Wrkr’s position as a key infrastructure provider in Australia’s evolving superannuation landscape makes it a stock worth watching. The next 18 months will be critical as Wrkr transitions from laying the foundation to realising the benefits of its strategic investments.
