Highlights:
- The innovative payment solutions provider has registered a 21% rise in the group revenue to AU$234.1 million.
- In a year, the gross debit volume of EML Payments (ASX:EML) grew by 308% to AU$80.2 billion.
- However, EML recorded a drop in NPAT and underlying EBITDA in FY22.
- Nevertheless, the share price of EML surged more than 12% on the ASX (as of 10:40 AM AEST).
ASX-listed software and services company, EML Payments Ltd (ASX:EML), on Monday (22 August 2022), shared its financial results for the FY2022. EML stated that these financial results demonstrate the growth opportunities that are present across EML’s global markets and its payment solutions and services.
On the back of the financial results, shares of EML marked a significant jump on the ASX. At 10:42 AM AEST, the EML share price was spotted at AU$1.20, 12.74% higher from its previous close. In six months, the share price dropped by 51.56% and year-to-date fall is 64.29%.
Key financial highlights of FY22
- During the year, the company delivered a record revenue of AU$234.1 million, up 21% on the prior corresponding period (pcp).
- Gross profit margins were 68%, up 1% on pcp.
- Gross Debit Volume (GDV) surged 308% to AU$80.2 billion in a year. GDV stands for the volume processed by a company during a specified period, representing the demand for its services. On GDV, EML said it witnessed organic growth across all segments, including acquisition growth.
- From 1 October 2021, the company consolidated the Sentenial Group into its digital payments segment.
- Underlying overheads grew by 41% to AU$108.4 million as investment was made in the European operations to address the regulatory resourcing requirements. Also, Sentenial’s consolidation contributed to underlying overheads.
- Due to increased investment in European operations, the underlying EBITDA dropped 4% on pcp to AU$51.2 million.
- Underlying NPAT dropped from AU$32.4 million in FY21 to AU$32.1 million in FY22, a drop of 1%.
- At the end of the year, EML’s cash and cash equivalent balance was AU$73.7 million.
EML to conduct an on-market share buy-back program
Today (22 August 2022), EML Payments also announced that it would implement a share buy-back program of around AU$20 million. The share buy-back program is part of the company’s proactive capital management strategy, said EML in a statement.
The share buy-back program would be conducted from 5 September 2022 on an opportunistic basis over 12 months.
Pre-paid financial card issuer informed the market that it has entered into a sale agreement for Interchecks Technologies, Inc., a finlabs investment of EML. As per the ASX announcement, this finlabs investment crystallised a 4x return on the initial investment.
After the sales of Interchecks, the company would have a strong cash balance. Also, the company expects solid cash flow in FY23. Therefore, EML would have considerable cash to deliver its growth initiatives and return the cash to its shareholders.