Paypoint Plc · LSE:PAY
Paypoint — Merger or Acquisition (November 2020)
10 slides from Paypoint's merger presentation, Nov 5, 2020
Slide 1: Acquisition of Handepay and Merchant Rentals
Nick Wiles, Chief Executive Alan Dale, Interim Finance Director Mark Latham, Chief Commercial Officer, Handepay Ian Kennedy, Sales Director, Handepay 5 November 2020
Slide 2: Acquisition of Handepay and Merchant Rentals
2 The information contained in this presentation relates solely to the acquisition of Handepay and Merchant Rentals announced on 5 November 2020. Only questions related to this acquisition will be permitted. PayPoint is currently in a closed period and will be reporting their interim results on 26 N
Slide 3: Important step to delivering enhanced growth and value in core U.K. market
3 Important step to delivering enhanced growth and value in core U.K. market Handepay (leading card payments business) and Merchant Rentals (card terminal leasing business) Well-established ‘top 4’ card payments business with over 21,000 merchants processing £3bn annually £16.7m gross revenue and ad
Slide 4: Leverage growth for core U.K. market
4 • Leverage growth for core U.K. market • Accelerates business shift to digital and services, away from cash • Capitalise on growing sectors and significantly increase diversity of customer base – combined business will have under 5% share of U.K. card merchant market • Capability to deliver better
Slide 5: 2016 - tipping point for shift to cards from cash by U.K. consumers
5 2016 - tipping point for shift to cards from cash by U.K. consumers PayPoint Q1 2020 data showed 75% increase in card payments through first UK national lockdown However, still circa 2m SMEs in UK who do not offer card payments 81% of consumers claimed they would be more inclined to shop locally i
Slide 6: Handepay: £3bn transactions annually, 21,000 merchants
6 £3bn transactions annually 21,000 merchants > 30,000 terminals leased Serving groceries, hospitality, auto trade, clothing and household goods Strong customer proposition – rated 4.9/5 on Trustpilot Acquisition of Handepay and Merchant Rentals
Slide 7: Acquisition brings scale and opportunity for combination synergies
7 Acquisition brings scale and opportunity for combination synergies 134 strong national 3 acquirer relationships Strong SME relationships sales team 30,000 merchant card payment relationships (Combined) 48 x PayPoint FTE 30,000 lease terminal 86 x Handepay relationships (Merchant Rentals) FTE 9,000
Slide 8: Observations from customer analytics
8 Observations from customer analytics: • The first lock down initially reduced active merchants by c10k with over 50% of the base continuing to actively trade throughout the period. This was driven by temporary closures of merchants and the furlough of sales staff (and therefore, the absence of new
Slide 9: FY ended 30 April 2020
9 FY ended 30 April 2020 Transaction of £70m Gross revenue (£m) 16.7 (Enterprise Value) expected to Adjusted EBITDA (£m)1 5.4 complete in January 2021, subject to regulatory approvals Operational Earnings enhancing in first full National sales team year of ownership Circa 500 new merchants a month o
Slide 10: Important step to delivering enhanced growth and value in core U.K. market
10 Important step to delivering enhanced growth and value in core U.K. market Well-established ‘top 4’ card payments business with over 21,000 merchants processing £3bn annually Significant growth and efficiency potential from enlarged card payment business Earnings enhancing in first full year of o