Paypoint Plc · LSE:PAY
Paypoint — H1 2025 Earnings Presentation
34 slides from Paypoint's earnings presentation, Nov 21, 2024
Slide 1: Results for the half year ended 30 September 2024
Results for the half year ended 30 September 2024 Highly confidential
Slide 2: Agenda
Open Banking Agenda 2 1 Overview 2 Financial review 3 Strategy update 4 Business review 5 Outlook 6 Q&A
Slide 3: H1 FY25 Highlights
Open Banking 3 H1 FY25 Highlights 1 Continued strong performance 2 underpinning our confidence in Strategic investments are enablers meeting expectations to further growth Delivered £37.5m of underlying EBITDA and made Investments in Yodel and obconnect to drive further progress towards delivering £
Slide 4: Strong financial performance
Strong Open Banking 4 financial performance H1 FY24 H1 FY25 DIVISIONAL HIGHLIGHTS SHOPPING E-COMMERCE Underlying EBITDA1 £31.1m +20.6% £37.5m H1 FY24 H1 FY25 H1 FY24 H1 FY25 £32.1m +2.5% £32.9m £5.1m +56.9% £8.0m net revenue net revenue net revenue net revenue Underlying PBT 2 £21.8m +23.4% £26.9m P
Slide 5: Financial review
Financial review Highly confidential
Slide 6: Strong financial performance
Strong financial performance 6 6 Half year ended 30 September 2024 2023 £m £m Change Revenue 135.0 126.5 6.7% Net revenue1 84.6 79.8 6.0% See slide 7 Underlying EBITDA 2 37.5 31.1 20.6% Underlying profit before tax3 26.9 21.8 23.4% See slide 8 Adjusting items4 (3.8) (4.6) (17.4)% Profit before tax 2
Slide 7: Continued net revenue growth in all divisions
6.0% net Co ntrevenue growth 7 inue d ne t re ve nue g ro w t h in a ll d ivis io ns 7 Half year ended 30 September 2024 2023 Change Change £m £m £m % Shopping 32.9 32.1 0.8 2.5% - Service fees 10.7 9.7 - Card payments 16.6 16.4 - ATMs & Counter Cash 4.0 4.5 - Other 1.6 1.5 E-commerce 8.0 5.1 2.9 56
Slide 8: Underlying PBT view vs. previous year
8 Underlying 2 .1 % inc re a s e inPBT PBT view vs. previous year 8 £30m £28m £0.3m £26m £1.3m (£0.2m) £24m £2.9m £26.9m £0.8m £22m £25.3m £22.6m £20m £21.8m 2 £18m Underlying PBT HY 23/24 Net Revenue Net Revenue Net Revenue Net Revenue L2s Net Costs* Underlying PBT HY 24/25 Shopping E-Commerce Paym
Slide 9: Streamlined cost base to support key areas of growth
Streamlined Co s t inc recost a s e s f ro base to support ke y a re a s t o dgrowth 9 m inve s t me nt in rive re ve nue s 9 £m 59 58 (£0.4m) £1.7m 57 (£2.5m) £0.3m 56 £0.6m £58.0m £57.7m 55 £56.1m 54 53 Total costs excluding adjusting Restructured cost base People inflationary pressures Investment
Slide 10: Strong cash generation of £30.7m
Strong S t ro ng c a s h cash g e ne ra t io ngeneration of £30.7m 10 o f £ 2 8 .3 millio n 10 Half year ended 30 September 2024 2023 Change £m £m £m Profit before tax 23.1 17.2 5.9 Non cash adjusting items (2.3) 0.6 (2.9) Depreciation and amortisation 11.4 9.7 1.7 Share based payments / other 0.3 0
Slide 11: Balance sheet
11 Balance sheet S t re ng t he ne d b a la nc – includes e s he e t , ne t d e b t £20m re d uc e d bshare y £ 4 .5 m buyback 11 Sept Mar Change 2024 2024 £m £m £m Goodwill 117.3 117.3 - Other intangible assets 63.5 67.1 (3.6) Property, plant & equipment 33.9 33.3 0.6 Strategic investments and acqu
Slide 12: Financing and Dividend
Dividend Fina nc ing & Dividand Financing 12 e nd 12 Dividend declared Net Corporate debt • 19.4p, an increase of 2.1% vs the interim dividend declared last year of • Net corporate debt is £86.8m, driven by investments and share buyback 19.0p per share, consistent with our dividend policy • Net corp
Slide 13: Strategy update
Strategy update Highly confidential
Slide 14: Progress on delivering £100m EBITDA by end of FY26
Open Banking 14 Progress on delivering £100m EBITDA by end of FY26 Reminder of our 6 key building blocks: 1 Parcels and Network Expansion 2 Card processing and major partnership expansion with Lloyds Bank 3 Open Banking and Digital Payments 4 Love2shop and Park Christmas Savings 5 Access to Cash and
Slide 15: Connecting capabilities across the Group
Open ourBanking 15 Connecting capabilities across the Group An additional growth driver leveraging our capabilities and partnerships 7 Connecting our capabilities SMEs Energy Sector Helping businesses grow with a comprehensive PayPoint OpenPay service delivering merchant proposition disbursement of
Slide 16: Business review
Business review P| PayPoint Group
Slide 17: Shopping: positive performance
Shopping: S ho p p ing Divis io npositive performance 17 17 Shopping Division How we deliver H1 FY24 H1 FY25 Retail Services £32.1m £32.9m PayPoint One/Mini, Counter Cash, FMCG, ATMs net +2.5% net Card payments revenue revenue Acquiring, terminals and Business Finance Sub-division Performance Estate
Slide 18: Shopping Division key focus areas
DrivingEnha further nc ing o urengagement re t a ile r & S ME p ro p oand s it io n revenue 18 18 Shopping Division Key focus areas FMCG 1 £0.6m net revenue, up 45.4% vs H1 FY24, with over 13 campaigns delivered for major brands across our retail network, including award- winning Win With Every Goal
Slide 19: E-commerce: strong performance
E-commerce: E- Co mme rc e Divis io nstrong performance 19 19 E-Commerce Division H1 FY24 H1 FY25 How we deliver Consumer pick up, drop off and send £5.1m +56.9% £8.0m No.1 carrier-agnostic Out Of Home (OOH) network, net revenue net revenue with best-in-class technology and consumer experience Leade
Slide 20: E-commerce key focus areas: Parcels and Network Expansion
ParcelsEnha and Network o ur re t a ile r &Expansion 20 nc ing S ME p ro p o s it io n 20 E-commerce Division Key focus areas Maximising carrier relationships 1 Royal Mail now in 5k sites, with plans to grow further, and major national advertising campaign now live to drive awareness and volumes acr
Slide 21: Payments & Banking: underlying MultiPay growth
Payments Pa yme nt s & Ba& Banking: underlying MultiPay growth 21 nking Divis io n 21 How we deliver Payments & Banking Division H1 FY24 H1 FY25 Digital • Open Banking and MultiPay digital payments platform Cash through to digital -0.8% £25.1m £24.9m • Gifting, gaming and Neobanks Cash • Bill paymen
Slide 22: Payments & Banking key focus areas
Leveraging our ing omultichannel payments platform 22 Enha nc ur re t a ile r & S ME p ro p o s it io n 22 Payments & Banking Division Key focus areas Open Banking growth UK market grew 90% YOY to 130m payments in 2023, with milestone of 10m 1 active consumer and business users in July 2024. Majorit
Slide 23: Love2shop: profit delivered
Love2shop: Pa yme nt s & Ba nkingH1 profit delivered 23 Divis io n 23 How we deliver Love2shop Division H1 FY24 H1 FY25 Love2shop • The UK’s leading digital platform for employee £17.5m £18.8m and customer rewards +7.4% net net Park Christmas Savings revenue revenue • The UK’s biggest Christmas Savi
Slide 24: Love2shop channel and partnership expansion
Channel and partnership expansion 24 24 Love2shop Division Key focus areas InComm distribution partnership Multi-year agreement enabling the distribution of Love2shop gift 1 cards for the first time into new retailer channels, including leading UK grocers and High St stores within the InComm Payment
Slide 25: Outlook
Outlook P| PayPoint Group
Slide 26: Summary and outlook
Summary and outlook 26 Out lo o k 26 The continued progress and momentum established across the Group, particularly with our six key building blocks, 1 underpin our confidence in delivering £100 million EBITDA by the end of FY26 Whilst there remain challenges in the broader UK economy around consume
Slide 27: Q&A
Q&A 27 Q&A 27 Q&A Results for the half year ended 30 September 2024
Slide 28: Appendix
Appendix Pp | PayPoint Group
Slide 29: Simplified overview of the business
Open Banking 29 Simplified overview of the business Multichannel payments platform and the delivery of community services through our retailer & SME networks Payments Network & Services Device Card Service Fee payments Digital Cash payments Love2shop vouchers, Open Banking rewards and Parcels Cash P
Slide 30: Investment case
Investment case 30 Ye a r o n ye a r vie w a c ro s s d ivis io ns a nd s ub - d ivis io ns 30 Multichannel payments platform and the delivery of community PayPoint Group services through our retailer & SME networks 1 Clear path to delivering £100m EBITDA by end of FY26 2 Leading multichannel paymen
Slide 31: Business division mapping
Business Bus ine s s d ivis io ndivision mapping 31 ma p p ing 31 Division Sub-division Lower level PayPoint One/EPoS Retail Services Counter Cash/ATMs Handepay/Merchant Rentals card payments Shopping and leasing Card payments PayPoint card payments Business finance E-Commerce E-commerce Collect+ pa
Slide 32: Year on year view across divisions and sub-divisions
YOY Ye a r o n view ye a r vie w across divisions and sub-divisions 32 a c ro s s d ivis io ns a nd s ub - d ivis io ns 32 Net revenue Division Sub-division H1 FY25 H1 FY24 Retail Services £16.3m £15.7m Shopping Card payments £16.6m £16.4m E-Commerce E-Commerce £8.0m £5.1m Digital £6.3m £6.4m Paymen
Slide 33: Adjusting items
Adjusting Fina nc ing & Divid eitems 33 nd 33 Half year ended 30 September 2024 2024 2023 £m £m Exceptional items 2.5 0.6 - Legal fees 2.1 0.6 - Accelerated amortisation (Love2shop) 0.4 - Adjusting items 1.3 4.0 - Amortisation of intangible assets arising on acquisition 4.0 4.0 - Net movement in con
Slide 34: obconnect overview
obconnect Fina nc ing & Divid e ndoverview 34 34 obconnect are an Open Banking technology platform with the capabilities to provide complete market ecosystems across Open Banking, Finance, Data, Energy, Confirmation of Payee and Enhanced Fraud Data They enable the Group’s solutions across: obconnect