Slide 1: FY20 Investor Presentation
FY20 INVESTOR PRESENTATION Tyro Payments Limited 18 AUGUST 2020 ABN 49 103 575 042
Slide 2: Setting businesses free to get on with business
Setting businesses free to get on with business by simplifying payments + banking solutions 2
Slide 3: The Tyro Ecosystem
The Tyro Ecosystem • Tech focused values driven company • Integrated ecosystem with payments at our core • Enhanced by value-adding features and products • Designed to attract new merchants and retain existing NPS Score of 43 merchants 99.99% availability of core acquiring platform Tyro sh Community
Slide 4: Results Highlights - FY20
Results Highlights - FY20 FY20 - Strong financial performance • h15% in transaction value to $20.1 billion (FY19: $17.5 billion) Transaction Merchant Loan Total Value Numbers Originations Revenue • h11% in merchants to 32,1761 (FY19: 29,031) • h15% in loan originations to $60.1 million (FY19: 52.2 m
Slide 5: Results in Overview
Results in Overview • Revenue h 11.0% • Gross Profit h 12.3% • EBITDA h 49.2% • Operating Leverage achieved COMMENTARY FY20 FY19 GROWTH PAYMENTS BUSINESS FY20 FY19 GROWTH $’000 $’000 % PERFORMANCE $’000 $’000 % Payments revenue and income 202,826 183,685 p 10.4% Revenue 202,826 183,685 p 10.4% Lendi
Slide 6: Response to COVID-19
Response to COVID-19 Assistance to our Merchants • Repayment holidays provided to support ~30% of all borrowers experiencing hardship • Terminal rental relief to impacted merchants - $1.6 million in rental relief • Merchants offered access to the Federal Government Coronavirus SME Guarantee Scheme -
Slide 7: Key Market Deliverables
Key Market Deliverables Merchant focus #1 COVID-19 Response - Recovery Journey Tyro Connect - New Frontier • Current NPS 43 (37 at 30 June 2019) • Focus on merchant assistance + recovery • Tyro Connect in pilot phase • Prompted brand awareness - 14% (FY19: 10%) • Terminal rental relief provided • An
Slide 8: Payments - Operational Highlights
Payments - Operational Highlights FY20 $’000 FY19 $’000 GROWTH % Strong transaction value growth Transaction value 20,131,045 17,496,322 p 15.1% • Transaction value of $20.1 billion h 15% (FY19: $17.5 billion) Revenue 202,826 183,685 p 10.4% • Transaction value growth h 29% accelerated to 29 Februar
Slide 9: Payments - Operational Highlights (cont.)
Payments - Operational Highlights (cont.) Strong performance from core verticals • Core Health, Hospitality and Retail verticals drive: - 83% of merchants Merchant - 90% of transaction value 26% 31% 26% 17% Count (8,433) (9,855) (8,518) (5,370) • Hospitality vertical growing strongly up h47% pre-COV
Slide 10: Payments - New Payments Product Offerings
Payments - New Payments Product Offerings eCommerce • eCommerce launched March 2019 - 384 merchants activated to use solution (FY19: nil) • Integrated to 11 popular shopping carts and hosted payment pages • $10.6 million in transaction value generated (FY19: Nil) • Fast-tracked access to the Tyro eC
Slide 11: Pre-COVID vs Post-COVID
Pre-COVID vs Post-COVID* Transaction Value Growth - FY16 to FY20 Monthly Analysis 1 January 2020 to 30 June 2020 Impact on Payments Business Average Growth Rate H1 FY16 - H1 FY20 CAGR +27% Pre-COVID h29% growth in transaction value 35% • 30% 31.1% • Post-COVID lockdown savaged transaction value grow
Slide 12: Pre-COVID vs Post-COVID (cont.)
Pre-COVID vs Post-COVID* (cont.) Geographical performance impact on Payments Business • Different states experienced varying levels of transaction value impact from COVID • Queensland h26% and South Australia h21% experienced the lowest level of impact • Post year-end, Victoria and NSW, our largest
Slide 13: Banking - Operational Highlights
Banking - Operational Highlights FY20 $’000 FY19 $’000 GROWTH % Tyro Business Loan Loan Originations 60,107 52,249 p 15.0% • $60.1 million in loan originations (FY19: $52.2 million) Revenue 1,818 2,938 q 38.1% • $51.2 million pre-COVID - h68% on pcp Interest income on loans 4,179 COMMENTARY 2,912 p
Slide 14: Banking - Operational Highlights (cont.)
Banking - Operational Highlights (cont.) Value-adding Banking Products Tyro Business Loan Tyro Bank Account Tyro Term Deposit Merchant Cash Advance Deposit Account Term-Deposit Account • An unsecured merchant cash advance designed to help merchants • A fee-free, interest-bearing transaction account
Slide 15: Banking - Operational Highlights (cont.)
Banking - Operational Highlights (cont.) Scaling our Banking products to our entire merchant base • All 32,176 of Tyro’s merchants can now check their eligibility for a loan through the Tyro app (compared to ~7,500 merchants in prior periods) • The Government Coronavirus SME Guarantee Scheme is avai
Slide 16: Pre-COVID vs Post-COVID (cont.)
Pre-COVID vs Post-COVID* (cont.) Loan Originations - FY16 to FY20 Impact on Banking Business • Loan originations Average Growth Rate Monthly Analysis H1 FY17 - H1 FY20 CAGR +127.1% 1 January 2020 to 30 June 2020 › Pre-COVID h68% $37.4m › Post-COVID i59% • Minimal loans post-COVID - $9.0 million (pcp
Slide 17: Overview of FY20 Financial Performance
OVERVIEW OF FY20 FINANCIAL PERFORMANCE Tyro Payments Limited ABN 49 103 575 042
Slide 18: Financial Performance - P&L
Financial Performance - P&L FY20 FY19 Growth Other revenue and income $’000 $’000 % • $3.9 million from JobKeeper scheme ensured no team retrenchments Transaction value 20,131,045 17,496,322 p 15.1% Strong cost control in a challenging year • Operating leverage demonstrated - total operating expense
Slide 19: Operating Metrics
Operating Metrics Operating Metrics as a % of Transaction Value 1.0000% 0.9531% Merchant Service Fee (MSF) reflects: 0.9403% 0.9500% 0.9292% 0.9269% • Onboarding larger merchants - priced on an 0.8911% 0.8953% incremental profit basis 0.9000% • Increase in lower MSF debit card usage - driven by COVI
Slide 20: Financial Position
Financial Position 30 JUNE 2020 30 JUNE 2019 $’000 $’000 Strong balance sheet underwrites continued growth ASSETS Cash1 122,190 31,810 Impact of the IPO Loans to merchants 11,921 15,665 • Increase in contributed equity $120.0m - primary offer of Other current assets 18,278 29,765 $125.0m less capita
Slide 21: Liquidity & Capital Adequacy
Liquidity & Capital Adequacy Total Capital Ratio increased to 162% 162% • IPO capital raised in December 2019 $166m Total risk weighted assets increased by $16.4 million • Investments of funds raised from IPO • Other assets held under AASB 16 $102m • Decrease in lending balance due to impacts of COV
Slide 22: Cash Flow Analysis
Cash Flow Analysis FY20 FY19 Operating cash flows: $’000 $’000 Net operating outflow before banking of $15.7 million principally driven by: Net payments income 86,513 77,394 Net interest income 5,548 5,128 • Cash spend of $16.0 million relating to IPO costs Other income 4,264 1,572 • Terminal purcha
Slide 23: Trading Update
TRADING UPDATE
Slide 24: FY21 Priorities
FY21 PRIORITIES • We continue to operate in uncertain times. • Our prime focus is to assist our merchants as they navigate their recovery journeys. • Our business model has proved its resilience and its ability to rebound rapidly. • We are committed to our journey of building an ecosystem centred ar
Slide 25: Trading Update
TRADING UPDATE1 • Challenges of COVID-19 continue • Victorian lockdowns are impacting - representing 23% of transaction value • Remain concerned with New South Wales COVID risks • Prime focus on assisting our merchants in their recovery journeys Weekly Transaction Value Growth - FY21 Payments busine
Slide 26: Supplementary Materials
£ ° a SUPPLEMENTARY > I MATERIALS - == F 4 26
Slide 27: Attachment 1 - Our Competitive Strengths
ATTACHMENT 1 - 1. Software-led approach to payments, based on a core proprietary technology OUR COMPETITIVE STRENGTHS platform 6. A values-led and talented team 2. Seamless direct integration with a significant number of POS systems 5. Focus on providing best- in-class service to tens of 3. A focus
Slide 28: Attachment 2 - Capturing Card-Present Terminal Market Share
ATTACHMENT 2 - CAPTURING CARD-PRESENT TERMINAL MARKET SHARE Number of terminals by banks and other providers in Australia (‘000) - as at 30 June 2019 (updated for Tyro terminals at 30 June 2020) CAGR (30 June 2014 — 30 June 2019) • 62,722 terminals at 30 June 2020 - up 22% from FY19 (2%) (3%) 3% 3%
Slide 29: Attachment 3 - Capturing Market Share in Growing Total Addressable Market
ATTACHMENT 3 - CAPTURING MARKET SHARE IN GROWING TOTAL ADDRESSABLE MARKET Annual transaction value of card payments acquired in Australia1 ($ billion) - Tyro’s estimated market share of total card payments acquired in Australia - as at 30 June 2020 as at 30 June 2020 4.0% ~3.0% 3.5% market share $66
Slide 30: Disclaimer
Disclaimer The material in this presentation is general background information about Tyro Payments Limited (Tyro) and is current at the date of the presentation, 18 August 2020. The information in the presentation is given for informational purposes only, is in summary form and does not purport to b
Slide 31: Investor Relations contact details
Investor Relations contact details: Giovanni Rizzo Phone: +61 (0) 439 775 030 Email: grizzo@tyro.com Address: 1/155 Clarence St, Sydney NSW 2000 Company website: tyro.com