SPY - Smartpay Holdings

[Crow]

Hi,

Just wondering opinions on latest share consolidation announcement? Any opinions. Been on my watch list for ages and used to hold them and since then a lot has changed. Now looking at a dual listing and doing a lot more work in Australia just wondering on views.

Thanks :D

[Tony Two Gloves]

I like this one Crow, I feel they are starting to make some head way and the ASX listing has been on the cards for a while so glad it is finally going ahead and we will hopefully see a lift in the SP.

Smartpay has required a good deal of patience!

[Scottman]

Well I've had my shares for a while and been disappointed with the run so far but don't want to bail out just yet. I've had a another look at the management & am happy with the calibre of the team. I'm not happy about the consolidation as it's the second one with the shares I have. I think they may have done the ground work and with the push into Australia we may be on our way up. Only time will tell and it's time they need to make things happen as with anything.

[Crow]

Yes definitely a lot to think about as that's why i bailed the last time..too many promises etc. I am just going to watch and see how things go after the dual listing and see major signs of progress across the board and that includes management.

[Tony Two Gloves]

What do you make of this Moosie? Has to be a positive right????

[modandm]

has anyone read the recent investor presentation?

No update on financial performance - are they lagging forecasts? Also never appreciated how much debt this company has - $29m or >3x forecast EBITDA. Stripping out intangibles of $20m this company is very indebted.

I was thinking of investing with the new management - seem smart people, but looking at this I'm not so sure. Its a competitive market, and with that debt burden I can't see these guys being able to invest enough to grow share.

This could end badly

[CJ]

Of course it's positive! I'm interested in how the company is going to use NF technology and to what degree. Mr Gaynor must know something buying at a premium to the market...Touch and go was everywhere in Melbourne when I was there recently (with $100 limit). It seems only petrol stations and the warehouse have it in NZ (with $80 limit).

Even our local New World which has just gone through a multimillion dollar refurb hasn't got new machines.

[steve fleming]

Of course it's positive! I'm interested in how the company is going to use NF technology and to what degree. Mr Gaynor must know something buying at a premium to the market...

Milford have also recently become a SSH in EML on the ASX. Its kind of in a similar space, offering alternative payment technologies

[Nigel]

Heard a Smartpay ad on the radio this morning (I think it was top and tailing the news or weather ot traffic or something). It basically said that they are the cheapest payments option around. Got my attention anyway :)

[Scottman]

Finally getting some traction. It's been a while. A good team. Patience is a virtue.
Disc. Held for about 3 years

[Bobcat.]

I can't see why over the past week this company is suddenly worth a lot more. 20% rise in sp today.

There may be some insider trading ahead of a significant news release but even so I see little point in holding on the off chance of something remarkable happening with technology of which I'm not really a big fan.

Reuters has them with an NTA of just 11c. Heavy gearing also makes me a bit reluctant to continue holding, and so I've just now taken profit - sold out at 37.

BC

[Nigel]

I can't see why over the past week this company is suddenly worth a lot more. 20% rise in sp today.

There may be some insider trading ahead of a significant news release but even so I see little point in holding on the off chance of something remarkable happening with technology of which I'm not really a big fan.

Reuters has them with an NTA of just 11c. Heavy gearing also makes me a bit reluctant to continue holding, and so I've just now taken profit - sold out at 37.

BC

I don't follow this too closely (used to be a shareholder back in the day) but tend to agree with you Bobcat. The rise has been dramatic to say the least, and the only news is that Milford have bought some shares. Not sure the jump is sustainable, so totally get why you would take the profit!

[whatsup]

Heard a Smartpay ad on the radio this morning (I think it was top and tailing the news or weather ot traffic or something). It basically said that they are the cheapest payments option around. Got my attention anyway :)

Nig, They were making those claims 10 years ago when I was a S Her !

[Nigel]

Nig, They were making those claims 10 years ago when I was a S Her !

I remember :) I've been out for years. Although I think (?) there's been a big management change and things seem to look a bit brighter now. Whatever happened to the ASX listing? Did that ever happen?

[ziggy]

yes it is listed on ASX as SMP.....also a good uplift in share price there too

[janner]

Will admit to having bought.. and held.. for many years.. Is in my written off drawer.

You can not win them all.. Learnt much from that exercise.. Quite slowly to begin with.. Now much quicker :-)
Only have two others in the same drawer..

Maybe.. Just maybe..

[Bobcat.]

Last week's presentation to Australian investors seems to have gone down very well. Unclear as to why - having read it I didn't find it very appealing. The financials especially are not impressive.

Still, who am I to argue with market sentiment? Clearly someone, or several someones, are thinking otherwise and are feeding well this puppy. SMP closed on the ASX at 38c. SPY on the NZX tomorrow will no doubt rise further to at least 40c to match. I still believe at this price, it's a fine time to sell. I've done so (a day too early as it turns out - yep, just like with my AZS stock, when I saw it jump I should've sat on my hands for 24 hrs).

BC

[jonu]

Maiden profit announced and look to be gaining traction in Oz. I've traded in & out of this crowd over the years, but might stick them in my "HOLD" category now.

[Scottman]

Still got huge debt. Debt to equity ratio is far to high for my liking. That's good news though. I bailed this week. My timing can be absolutely crap sometimes.

[DarkHorse]

I notice Microequities - highly respected Australian smallcap manager - have a strong buy on this. Forecast fwd PE 15.5 2017, 6.4 2018
Wondering if anyone holds shares and/or an opinion based on recent analysis?

19.12.16
Investment Opinion
We retain our STRONG BUY recommendation following the release of the 1H17 results, with a price objective of A$0.24.
This is a 52.3% premium to the last traded price. The price objective is an average of the DCF valuation of A$0.22 and our relative peer valuation of A$0.26. While the 1H17 results were behind our expectations, we believe that the results also confirmed that SMP’s financial results have begun to inflect, and we expect significant growth in earnings and free cash flow over the next two years as the company moves through a period of heavy investment. We also expect further market share growth in Australia in the general retail market. In the medium term, there may also be additional upside from entering into merchant acquiring, or M&A opportunities that are not captured in our forecasts or valuation.

[smiley]

Peoples thoughts on this. Seems to be a sleeping dragon. TBF quietly aquiring shares in the background and earnings up on last year. Smartpay systems more and more prominent in shops and no sign off them being replaced by anything else

[gbogo]

announcement today and biggest riser on NZX today...

https://www.nzx.com/announcements/315464

any thoughts?

[silverblizzard888]

First mover advantage in the future of payment services, its a pretty good step to at least in future proofing the business. Not sure how much it'll at to the bottom line for now, though if you went to say China and see how influential Alipay or Wepay is, you'd think NZ was a third world country with its eftpos terminals still being the main way to pay.

[golden city]

Anything link to Ali pay is like new blood injection it change the landscape

[Leftfield]

Peoples thoughts on this. Seems to be a sleeping dragon. TBF quietly aquiring shares in the background and earnings up on last year. Smartpay systems more and more prominent in shops and no sign off them being replaced by anything else

Watching carefully........Alipay contract looks good, but what does it mean in terms of actual revenue?

The world seemed full of opportunities when WYN was announcing all its great new contracts, and PLX (remember them?) was announcing contracts with MacD's and IKEA etc..... Contracts are one thing, actual revenue is another, and profits remained elusive.

There are other risks in where technology in this field is headed. Apple Pay and other's are hovering.

I welcome more informed input and am merely watching at this stage. Early days.

[GTM 3442]

I don't know if it's informed comment, but here we go. . .

There are about a squazzabazillion debit and credit and other cards out there, each of which needs to be read somehow, by something, at the point of sale.

Smartpay provide the readers, so they are going to make some money along the way.

But what is the online card spend as a proportion of total card spend? And is it rising?

I have no figures, but I think it's rising. So the proportion of card transactions which don't require a "card reader" is likely to rise as well. So Smartpay are in an expanding market, but a market where they supply hardware which is less and less necessary.

The U.K. has a number of fintech companies - Mondo and Revolut spring to mind - which are app-driven. Sure they are card-oriented at the moment, but their primary focus is the app.

Just like Apple Pay, Android Pay, et al.


After all, if you can pay with your card, and you always carry your card, why carry cash as well, and if you can pay with your phone, and you always carry your phone, why carry a card as well?

There are going to be a lot of cards about for the foreseeable future, but they are going to lose market share to the app-driven competition.

The question is the uptake of phone/app payment systems, and the speed of that uptake.

And how can Smartpay diversify into the new payment ecosystem?

[Leftfield]

Well said GTM... good helpful post which echo's my concerns re the longer term viability of this one.

[GTM 3442]

Well said GTM... good helpful post which echo's my concerns re the longer term viability of this one.

Think of it in terms of investing in a company which makes printing machinery for machine-readable chequebooks.

1960 No market, but they have them overseas, let's take a punt. . .
1970 Wow! Everyone's getting a cheque book! Looking good
1980 Absolutely amazing
1990 How are these new card things doing? Better keep an eye on them
2000 Ah hmm what's all this about online payments again?
2010 The money's coming from the maintenance division, not new sales. . .
2020 Your guess is as good as mine

[gbogo]

PayPal just bought IZettle for $2.2B because they have a good footprint in terminals and apps in Europe.

https://www.cnbc.com/2018/05/18/why-paypal-bought-izettle-for-2-point-2-billion.html

SmartPay seems to have the same footprint in Aust and NZ. Much smaller market but good acquisition at some stage for PayPal or some other global player?

Look how similar their pitch is:

https://www.smartpay.co.nz/
https://www.izettle.com/gb

lots of offers on the ASX seem to be keeping a lid on it but total only $400k..

disc: long and trying to buy more.

[gbogo]

another company that looks to be in the same business (but in the USA) as SmartPay: https://www.cpay.com/

just sold 15% of the company for $840m USD valuation vs $23m for SPY.

my uneducated eye, says that there is so much M&A activity happening in the payments space, that it wouldn't be a big surprise if another deal (like the abandoned Pemba Capital opportunity, in 2017) came along soon.

disc: still long, still bidding.

[Timesurfer]

I note that the buy side was empty for part of the day today.
Might take a fair kick to get this dog moving again?

[co0p]

Did anyone catch the AGM earlier in the week? I'm keen to know more about the progress (if any) of monetising their NZ base.

Australian acquiring seems to be going well. I've recently seen listings on Seek for field agents, sales staff etc so hopefully terminal number growth accelerates!

Onwards and upwards hopefully.

[Schrodinger]

How does a company growing at 3% and accumulated losses of $40m become a good choice for putting your money in? Annual loss of $2m+.

Expenses increased by $4m and revenue by $500k. I don’t think investing in companies flogging eftpos terminals is a wise move. Claims by the Chairman that his new director hires will/have helped with sales and marketing is a joke. Time for replacements?

It leads to the question: are they really better than the Australian incumbents? Does anyone care?

[co0p]

How does a company growing at 3% and accumulated losses of $40m become a good choice for putting your money in? Annual loss of $2m+.

Expenses increased by $4m and revenue by $500k. I don’t think investing in companies flogging eftpos terminals is a wise move. Claims by the Chairman that his new director hires will/have helped with sales and marketing is a joke. Time for replacements?

It leads to the question: are they really better than the Australian incumbents? Does anyone care?

I'm guessing you didn't see it

[co0p]

Wow! Achieving that price for the mature and less profitable part of the company is a great result.

Question is, what value will the market assign to the cashed-up, more profitable and very fast growing Australian operation.

Onwards and upwards.

[Joshuatree]

Wow! Achieving that price for the mature and less profitable part of the company is a great result.

Question is, what value will the market assign to the cashed-up, more profitable and very fast growing Australian operation.

Onwards and upwards.

TRANSACT: SPY: Sale of NZ Business and Assets (https://online.asb.co.nz/ost/0BF37AFD391128507079709897F5F386/companyannouncements/showannouncement/nzx/spy?issuercode=spy&number=345113&ispdf=false) .

A great result indeed for what seems a pretty mature business.
I have bought an initial parcel on the ASX (SMP).

Over one million terminals in Aus with the push to cashless society increasing. Cashback coming and maybe takeover sharks circling? The time is ripe for SMP to grow fast after years of not. We will see. DYOR

https://egpcapital.com.au/wp-content/uploads/2019/12/2019_Nov.pdf Great analysis page 5


SHINTR: SPY: SPH Notice - Milford Asset Management Limited (https://online.asb.co.nz/ost/0BF37AFD391128507079709897F5F386/companyannouncements/showannouncement/nzx/spy?issuercode=spy&number=345357&ispdf=false)

[Cadalac123]

I took a small position on smartpay post-announcment. Hoping to catch that cash distribution that no one seems to really care about? It's 20c for every share...

I assume people are weary of the deal with verifone going sour? Or people don't want to get invested in a company that seems to be a little bleak in terms of its future?

I do note there has been significant algo trading on this stock - wonder if big institutions are trying to keep the stock price down so they yield higher.

[Joshuatree]

Hi Cadalac , Its been a dog stock for re 7 years so people have permanently turned it off in their investment minds by the looks of it. But what a price and what sudden transformation and great value even now imo. DYOR


" At the end of the month, the market capitalisation of SMP was about $77m; with about $67m coming through the door once the NZ business settles (less any costs/taxes). In simplistic terms, you’re paying about a $10m market capitalisation for a materially better business than the one that just transacted for $70m. To say we still think the current market capitalisation of SMP materially undervalues the business is to significantly understate our view of things."
https://egpcapital.com.au/wp-content...2/2019_Nov.pdf (https://egpcapital.com.au/wp-content/uploads/2019/12/2019_Nov.pdf)

[co0p]

I'm really excited about Smartpay's prospects.

I see their long time tech partner are releasing a suite of new products into Australia. I hope Smartpay are all over this!

https://www.itnews.com.au/news/banks-position-for-payments-war-as-pax-enters-australia-with-android-card-killer-terminal-535496

[Cadalac123]

Guess people are waiting for the deal with verifone to actually be formally accepted?

[Cadalac123]

Any reason you bought on ASX and not NZX? Just for liquidity purposes? @Joshuatree

[Timesurfer]

Interesting note.

The price of Smartpay Holdings Limited Ordinary Shares (“SPY”) has increased from $0.53, being the market open price on 28 January 2020, to $0.645, being the current price at 2.20pm on 29January 2020. This represents an increase of 21.7%. Given this price increase, please advise NZX whether Smartpay Holdings Limited continues to comply with Listing Rule 3.1.1.

[Joshuatree]

I put this on the ASX "Who knows thread "

Im holding Smartpay. No news but sale of NZ ops conditions (below ;announced on 28/11/19 for a cool $70 mill) being met may be imminent as well as the 20c div.
Shareprice jumps 10.3% on big vol." SPY on NZX SMP on ASX

Download Document 272.8KB (https://hotcopper.com.au/documentembed?id=uOMxKKzFkiWRTLKhOROKAxjvSDYL4ga1z hH%2Fv%2BR077FiGug%3D)

[Cadalac123]

little strange this happens now though when that news was known a while ago?

[Timesurfer]

Looks like mr market is happy with that result

[Cadalac123]

Depth is the dodgiest thing i've seen in my life on this one haha

[Justin]

why the sp tripled in 3 months？

[Cadalac123]

And down it goes lol

[Balance]

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/SPY/352480/321749.pdf

Deal's off.

[Joshuatree]

There goes $70 mill and a 20c divi.

[James108]

They proposed new terms which would still presumably realise substantial value for those who bought around 20c.

Cant see another buyer interested other than verifone.

[Manukatana]

They proposed new terms which would still presumably realise substantial value for those who bought around 20c.

Cant see another buyer interested other than verifone.

sorry what does this mean for Smartpay?? very bad? I saw the share price dropped so much today. is current 0.39c too expensive?

[nztx]

They proposed new terms which would still presumably realise substantial value for those who bought around 20c.

Cant see another buyer interested other than verifone.

the only issue was later OIO approval delay wasn't it, or did I miss something .. ?

This one has been very kind to me over the past 5 months or so with SP volatility up & down which looks likely to continue

I guess now just waiting time for another lower point to shuffle in for another load up

[James108]

The way I read it the oio approval let them cancel the deal, which they probably wanted to do because of Covid-19

[Joshuatree]

Am back in @ 32.5c with an initial holding ,after my big portfolio selldown on 4th feb, @ 62c.. Covid is a positive for SMP .The catalyst shift to electronic transactions will benefit big time.

[James108]

Maybe if you ignore the looming deaths of many bricks and mortar retailers and the switch to online purchases. I’m a holder but can’t see how Covid is a positive for spy.

[nztx]

Maybe if you ignore the looming deaths of many bricks and mortar retailers and the switch to online purchases. I’m a holder but can’t see how Covid is a positive for spy.

Good point - don't SPY specialise in selling terminals etc into retail ? .. which may be affected in places for as long as C-19 takes to shake out & for growth to occur..

Now they're back to having exposure in both Oz & NZ in these markets, with no real improvement in their Balance Sheet & facing perhaps temporary retail transactions & equipment sales being down, longer term maybe improving retail trading patterns when things reverse upwards again ?

[Joshuatree]

Im not looking at anything short term, be crazy to.Im getting back in at a great price (A32.5c) and am hopeful of another bite at a lower price soon. as i jog around my city i see it starting up again albeit in a small contactless way, as well as the tyre guy, the garage, the baker, the sports shop etc etc. This comcom review worth reading, will Verifone be back?

https://comcom.govt.nz/__data/assets/pdf_file/0016/215611/Verifone-Submission-on-Verifone-New-Zealand-and-Smartpay-Holdings-Limited-Statement-of-Issues-28-April-2020.pdf (https://comcom.govt.nz/__data/assets/pdf_file/0016/215611/Verifone-Submission-on-Verifone-New-Zealand-and-Smartpay-Holdings-Limited-Statement-of-Issues-28-April-2020.pdf)

[Joshuatree]

Great research note here, its free just register heres a snippet

"Smartpay avoids industries with prepayment risk such as travel agencies. They are very strong in small-medium enterprises in the hospitality industry. Large businesses demand lower prices from their payments provider. The banks focus on them with the hope of offering other financial products (e.g. debt facilities). Tyro now focuses on banking products rather than pure payments, using their banking licence. Smartpay is the only major operator with a complete focus on the payments business. No significant competitors (other than Square) have entered the market because there is a high moat. It takes at least 6 months of work to connect a new switch so switch providers tend to avoid talking to new entrants if they’re small operators.

https://insufficientcapital.com/2020/03/31/insufficient-capital-march-update/ (https://insufficientcapital.com/2020/03/31/insufficient-capital-march-update/)

[Joshuatree]

Raising funds at no discount to s/p at T/H, 42c..

“Payments terminals company Smartpay is pitching a raising with a nil discount to investors on Wednesday morning. The company was seeking to raise $10 million via a placement of new shares at 42¢ each, which was in line with its last sale price.

Funds raised were to "strengthen the balance sheet through initial debt reduction and to provide flexibility for post COVID growth in the Australian merchant acquirer market", according to terms sent to potential investors.

CCZ Statton was managing the offer.It was calling for bids by 4pm on Wednesday and the placement was due to be announced on Friday, the term sheet said.Smartpay had a $73 million market capitalisation prior to the raising. Its shares are listed in Australia and New Zealand. It comes as Smartpay seeks to sell its New Zealand assets. The company had a deal with Verifone, however the agreement was terminated and Verifone made a revised offer. Smartpay's board rejected Verifone's new bid, and is now able to offer the business to other potential buyers.” STREET TALK

[Cadalac123]

Raising funds at no discount to s/p at T/H, 42c..

“Payments terminals company Smartpay is pitching a raising with a nil discount to investors on Wednesday morning. The company was seeking to raise $10 million via a placement of new shares at 42¢ each, which was in line with its last sale price.

Funds raised were to "strengthen the balance sheet through initial debt reduction and to provide flexibility for post COVID growth in the Australian merchant acquirer market", according to terms sent to potential investors.

CCZ Statton was managing the offer.It was calling for bids by 4pm on Wednesday and the placement was due to be announced on Friday, the term sheet said.Smartpay had a $73 million market capitalisation prior to the raising. Its shares are listed in Australia and New Zealand. It comes as Smartpay seeks to sell its New Zealand assets. The company had a deal with Verifone, however the agreement was terminated and Verifone made a revised offer. Smartpay's board rejected Verifone's new bid, and is now able to offer the business to other potential buyers.” STREET TALK

That must have been one bad revised offer for them to reject and then raise at this price lol

[Joshuatree]

Great for me lol

[Cadalac123]

Great for me lol

Out of curiosity why smartpay over tyro on ASX ?

[Joshuatree]

Maybe if you ignore the looming deaths of many bricks and mortar retailers and the switch to online purchases. I’m a holder but can’t see how Covid is a positive for spy.

"With both the Australian and NZ economies opening up again, we believe we are well placed to resume and accelerate our growth in new terminal numbers this year. We expect to benefit from positive tailwinds as the effects of COVID further entrench cashless and contactless payments and through the strength of our superior product and commercial offering to what we expect will be increasingly value and cost sensitive merchants."
Download Document 348.27KB (https://hotcopper.com.au/documentembed?id=uOMxKKzFkiWRTLKhOROKAxjvSDYL4Qy6y xf%2Bv%2BR077FiGug%3D)

Hey Cadalac what research can you share about Tyro a recent company, thanks. Ticker is TYR.

[kiora]

You could also check out ZIP JT
https://zip.co/nz

[Joshuatree]

Was hoping you guys would do some "sharing" but appreciate the deas.Sticking with SPY atm and taking up my spp.

[kiora]

Was hoping you guys would do some "sharing" but appreciate the deas.Sticking with SPY atm and taking up my spp.

I did :)
Did you buy it?
https://stocknessmonster.com/quotes/z1p.asx/
https://stocknessmonster.com/announcements/z1p.asx-2A1228686/

[Joshuatree]

Congrats.Nah havnt looked at it, cant be bothered researching too many stocks, my quality of life is more important. DOH left it too late to go for my jog today!.But couldntmiss it on H/C all the posts today, zillions of posts. Euphoria over the top. Trading it? Thanks for sharing.

[sb9]

Dipped my toes into this one last week, but not in time to be eligible for SPP though, never mind. Looking good to reach previous price levels before the Verifone deal fell through..

[Cadalac123]

https://nz.finance.yahoo.com/news/rba-looking-lower-e-payment-costs-024207422--spt.html

thoughts?

[AceSee]

Hi team, any thoughts on the Smartpay SPP? Share price has gone up over the last month or so and even after the announced the SPP at 42c! I bought some shares in them precovid so will end up taking the offer. But i cant explain the current increase!

[Joshuatree]

A rising tide lifts all boats as peat was saying elsewhere and talk of The verifone deal could be back on with the increase in contactless payments making the NZ business even more valuable.

[sb9]

Should be back to 70c soon as per below update...

https://www.nzx.com/announcements/354507

COVID-19 Trading Update

Australia - We are pleased to confirm that with the further easing of restrictions over the past week, our aggregate transactional revenue has recovered to 95% of pre COVID levels.We note that we have one merchant category which is still restricted from trading which accounts for the remaining 5% of aggregate transactional revenue. When this final category resumes trading we expect to be back at 100% of pre COVID levels.

New Zealand - As the primary revenue driver in our NZ business is terminal rental,our NZ business has shown itself to be extremely resilient through the COVID-19 period. With the NZ COVID lockdown restrictions now ended (other than for international travel), we are seeing a rapid resumption in terminal usage by our merchants.

[Joshuatree]

And this should help make up folks minds re taking up their SPP:)

New Zealand Commerce Commission Clearance Obtained (https://www.nzx.com/announcements/354589)

[sb9]

Big over subscription for SPP, asked for A$ 2ml, applications received for approx A$ 11.95ml nearly 6 times more. Going to be a massive scale back...

[Joshuatree]

S/P jumps in response up 8c to 59.5 c atm.

[sb9]

Price on par at 60c close both for NZX and ASX as of last week

[chuggie]

Solid report - https://www.nzx.com/announcements/355105

[sb9]

Solid report - https://www.nzx.com/announcements/355105

Pretty startling numbers for Aussie side of business

[sb9]

Total revenue from contracts with customers for AU grew to $11.8ml in 2020 from $4.5ml in 2019.

That's all it matters for now...

[Joshuatree]

Full Year Results Presentation 13 pages 1.1MB (https://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=02247617)

some profit taking today

[chuggie]

Anyone's SPP shares been allocated yet?

[sb9]

Anyone's SPP shares been allocated yet?

Wasn't eligible for SPP at the time of my original purchases, however have added few more over past few days. The contactless payment system is firmly in place forever in greater scale due to COVID situation.

[sb9]

Just like many dual listed stocks, volume on ASX is 10 times that of NZX at 1ml+ compared to paltry 100k+ here.

[sb9]

Pretty solid numbers reported by Tyro-ASX from their update today. They operate in same industry as Smart Pay.

https://hotcopper.com.au/attachments/image-png.2282646/?temp_hash=5c35a7d947d86ef551cdfd385e482269

[Joshuatree]

Thanks. TYR, wasnt aware of it, pretty new listing.
17% increase despite 4 terrible covid months.

[sb9]

Massive volumes today on SMP-ASX, 2.3mln+ volume so far...

[Joshuatree]

Download Document 278.18KB (https://hotcopper.com.au/documentembed?id=uOMxKKzFkiWRTLKhOROKAxjvSDYL4Q20z xT2v%2BR077FiGug%3D)

No mention of NZ ops.

[co0p]

Interesting that. With the number of terminals in NZ it must still be play, either to be bought or to transition into acquiring.

I wonder which industry makes up the the 5% of terminals not acquiring in Australia.

[Tradernoob]

Anyone have reasoning for the sudden dip today? Is it from that announcement of the resignation of the CEO?

[nztx]

Anyone have reasoning for the sudden dip today? Is it from that announcement of the resignation of the CEO?


Indigestion & disruption in OZ could be a factor

Didn't they open their share register up to more Aussie holders ?

[James564]

Looking like a good buy if this drops to around 0.6 or lower, this new lockdown announcement may effect it slightly , trying to figure out whats the best dip to buy!

[Chuckles]

Anyone know whats happening with SPY's SP over the last few days? I notice it has broken through a support level of $0.64 and is now trading at $0.61. I note the ASM slated for 23 September.

Cheers & good trading,

Chuckles

[nztx]

Anyone know whats happening with SPY's SP over the last few days? I notice it has broken through a support level of $0.64 and is now trading at $0.61. I note the ASM slated for 23 September.

Cheers & good trading,

Chuckles


More Indigestion & disruption in OZ could be a factor ? ;)

[sb9]

Very positive update from the company...

https://www.nzx.com/announcements/359941

[chuggie]

I'm surprised SPY doesn't get more coverage on ST. It's been a nice little earner for me, got in early last year.

[sb9]

Solid update and stock should re-rate upwards based on numbers..

https://www.nzx.com/announcements/361476

[Joshuatree]

Download Document 283.43KB (https://hotcopper.com.au/documentembed?id=uOMxKKzFkiWRTLKhOROKAxjvSDYL4Qu6y hD%2Bv%2BR077FiGug%3D) And another one but anything techie knocked back today.

[sb9]

Big volume day over on ASX with 1.3mln+ shares traded today with close of 70c AU and VWAP of 66c AU.

Looking good to move past 70c and beyond here.

[Tradernoob]

Can anyone explain to me the discrepancy in pricing between SPY on the nzx and SMP on ASX? They normally track around 3-5 cents difference but are currently a 9 cent difference between the two.
TIA

[sb9]

Looks like Milford have added bit more in the last few months.

[Joshuatree]

"Tyro, probably SMPs major competitor outside the banks, has significant outage issues with its system. The AFR has an article titled "SMEs fume: Tyro outages stretch into second week" and it states it may not be fixed until end of this week."

This may lead to more choosing SMP machines over time.


" the AFR articles state that Tyro has to replace 10,000 machines out of 60,000 they have in operation for 32,000 clients. I would be very surprised that they have that many machines just sitting around but who knows. That is a huge exercise and to replace that many in such a short time is difficult.
- I am not aware of any Tyro competitors other than the banks and SMP but someone else may. If the only competitor is SMP then given what has happen my view is SMP will pick up a lot of additional clients from the affected businesses - how many is unknown but I assume some will go back to the banks.
- even if Tyro has 10,000 machines sitting around it will impact their new business until they obtain new machines; not sure how long it will take for them to order and receive new machines (I assume they will come from overseas). This will mean more new business for SMP for a period .
- impact on brand - banks have outages at times but it is usually for a few hours or at most a day - up to two weeks to significantly impact a business is in a different league and I do expect the impact will be beneficial to SMP for some time (will SMP use it as a marketing ploy and give evidence from their operations in NZ of how good their machines are? who knows)
- I can see a class action against Tyro coming unless Tyro compensates the businesses impacted - either way it will cost Tyro a lot of money. If there is a class action there will likely be adverse brand impact on Tyro
- I doubt this will be the last we see about Tyro's problem in the media
- Tyro shares are down over 4% yesterday and over 8% today
- SMP shares have hardly moved - they are a thinly traded company. I do not expect much movement in SP until SMP comes out with an announcement of financial or other results unless they make a separate announcement on machine/client take up."

[nztx]

Interesting article - Joshuatree

I detected a bit of movement in SPY SP yesterday & couldn't see what was responsible for this until your post

Later today could be interesting on whether interest continues on NZX

[sb9]

Pretty solid update and going from strength to strength esp in AU, bring on the buck on sp..

[Joshuatree]

Ann: GENERAL: SPY: Trading Update (https://hotcopper.com.au/threads/ann-general-spy-trading-update.5863268/) Yes nearly a 3 bagger toot suite.The road ahead looks clear.

[percy]

Ann: GENERAL: SPY: Trading Update (https://hotcopper.com.au/threads/ann-general-spy-trading-update.5863268/) Yes nearly a 3 bagger toot suite.The road ahead looks clear.

You have made good calls with this share.

[sb9]

Nearly 2 bagger here...seems as though Tyro’s troubles are helping this one in Aus.

[Co0p_New]

Cool little podcast by Rask Media. Marty explains the industry and Smartpay very eloquently.

Deep-dive: The payments industry, ft. Smartpay (ASX:SMP) CEO Marty Pomeroy - YouTube (https://www.youtube.com/watch?v=hoxRXjo6Za4)

[Muse]

Cool little podcast by Rask Media. Marty explains the industry and Smartpay very eloquently.

Deep-dive: The payments industry, ft. Smartpay (ASX:SMP) CEO Marty Pomeroy - YouTube (https://www.youtube.com/watch?v=hoxRXjo6Za4)

thanks Co0p - will give a listen

I am looking forward to the 31 march 2022 full year result. The first half was impressive indeed

[Co0p_New]

thanks Co0p - will give a listen

I am looking forward to the 31 march 2022 full year result. The first half was impressive indeed

No worries.

It sure was. More of the same I suspect.

[Joshuatree]

Yeah thanks.Its been on my to do top up list a while .Increased my holdings by 40%..Update on re the 19th,20th I think.

[Joshuatree]

https://hotcopper.com.au/documentembed?id=uOMxKKzFkiWRTLKhOROKAxjvSDYL4Ai1z Rn%2Bv%2BR077FiGug%3D

Yep,Going gangbusters in Aussie

[Muse]

https://hotcopper.com.au/documentembed?id=uOMxKKzFkiWRTLKhOROKAxjvSDYL4Ai1z Rn%2Bv%2BR077FiGug%3D

Yep,Going gangbusters in Aussie

very credible result. finally have enough to do a back of the envelop EBITDA and NPAT calc for the 31 March 2022 FY and estimate of the new current financial new

[nztx]

taken a while for SPY to shake off the Covid jitters and point us to light at end of the tunnel :)

[Co0p_New]

Solid revenue growth. Looking forward to a strong and profitable FY23.

[nztx]

Solid revenue growth. Looking forward to a strong and profitable FY23.


the buck or higher might come into range again - who knows ? :)

especially if the Aussies take a shine to what they see

[Muse]

Solid revenue growth. Looking forward to a strong and profitable FY23.

2H FY22 should have been well profitable. and FY23 looking great

[Co0p_New]

very credible result. finally have enough to do a back of the envelop EBITDA and NPAT calc for the 31 March 2022 FY and estimate of the new current financial new

Super interested in what you’ve ended up with. Any chance you can share….

[Muse]

Super interested in what you’ve ended up with. Any chance you can share….

I have enough to start updating my estimates but that doesn't mean i've started lol.
This is a small specy one for me because I enjoy the payment and fintech space but i'll get to it someday before the full year accounts are released

there must be two smartpay threads as there are loads of posts from 6 months to a year ago that aren't here

[Co0p_New]

I have enough to start updating my estimates but that doesn't mean i've started lol.
This is a small specy one for me because I enjoy the payment and fintech space but i'll get to it someday before the full year accounts are released

there must be two smartpay threads as there are loads of posts from 6 months to a year ago that aren't here

Fair enough! I'll have a run at it too.

[Muse]

2H FY22 should have been well profitable. and FY23 looking great

The 2nd half result was even better!

Full year announcement out. $11.1m EBITDA and NPAT of $3.1m. But the vast majority of that earnt in a clean 2nd half

2H FY22 EBITDA of $7.352m vs 1H $3.744m.

2H FY22 NPAT of $2.679m vs $0.4m in the first half

The business is rapidly scaling and absolutely hoovering marketshare in Australia, exploiting Tyro's weakness. Good result given the lockdowns across both NZ and AU over the financial year. With unit roll outs continuing at pace and revenues locked in from those and no further lockdowns FY23 should show a substantial step-up it profitability on the year just been, and FY24 on that.

Nice to see the benefits of scaling and long may it continue. I look forward to its earnings (and SP) in 3 years.

My two cents only...DYOR.

[Mel]

I've recently bought in - solid result, with good growth potential. Good to also hear that March 2022 was a record month.

[Co0p_New]

Very pleasing result. FY23 should be a cracker.

[Muse]

Very pleasing result. FY23 should be a cracker.

yup. and the 1H FY23 (end of september) should show NPAT many, many multiples up on 1H FY22.

trading up 13% on the ASX - at A$0.67 on the ASX, or NZ$0.734. On the NZX, smartpay trading at 0.685, or about a 7% discount to the NZD price on the ASX

[Joshuatree]

The 2nd half result was even better!

Full year announcement out. $11.1m EBITDA and NPAT of $3.1m. But the vast majority of that earnt in a clean 2nd half

2H FY22 EBITDA of $7.352m vs 1H $3.744m.

2H FY22 NPAT of $2.679m vs $0.4m in the first half

The business is rapidly scaling and absolutely hoovering marketshare in Australia, exploiting Tyro's weakness. Good result given the lockdowns across both NZ and AU over the financial year. With unit roll outs continuing at pace and revenues locked in from those and no further lockdowns FY23 should show a substantial step-up it profitability on the year just been, and FY24 on that.

Nice to see the benefits of scaling and long may it continue. I look forward to its earnings (and SP) in 3 years.

My two cents only...DYOR.

Nice summary.Take out the covid effect and future earnings will be even brighter.

[na2m1]

Feeling positive about this business. Been buying since last year after I saw more and more Smartpay machines in takeaways and retail shops.

[Co0p_New]

Another ripper of an update. Pretty happy to hold this one for a while :-).

[Muse]

Another ripper of an update. Pretty happy to hold this one for a while :-).

Q1 revenue smashing it - up 48% on Q1 last year

should be exceptionally profitable now, given the strong profit performance in 2H FY22.

[winner69]

Q1 revenue smashing it - up 48% on Q1 last year

should be exceptionally profitable now, given the strong profit performance in 2H FY22.

So share price should be over a buck sooner than later?

I'm all for a quick 50% profit

[Muse]

So share price should be over a buck sooner than later?

I'm all for a quick 50% profit

down 1.5% on $10 worth of trade in the first 3 minutes LOL

[Rawz]

So they will do $75m-$80m revenue. what sort of profit will that be? $9-$10 mill?

[Joshuatree]

Q1 revenue smashing it - up 48% on Q1 last year

should be exceptionally profitable now, given the strong profit performance in 2H FY22.

Beautiful metrics there ehh.Am 58% up atp with a long ways to go I reckon.

[Co0p_New]

Yes indeed.

Word that keeps spring to mind "flywheel".

[winner69]

So they will do $75m-$80m revenue. what sort of profit will that be? $9-$10 mill?

At least $10m rawz ..... makes 68 cents share price look cheap as

[Rawz]

At least $10m rawz ..... makes 68 cents share price look cheap as

If they do at least $10m they are trading on a forward P/E of 16 but growing rapidly. Should be priced on a higher multiple.

Happy holder

[winner69]

Jeez, a bit of gravy chain - they want to increase Directors fees by $300,000 to $500,000

[Co0p_New]

It is quite the increase. Somewhat deserved considering the changing fortunes of the company.

[Co0p_New]

AGM tomorrow. It would be nice to get some guidance for FY23 or at least 1H.

I’m predicting FY23 Sales of ~$72M and EBITDA of ~ $23M. Closing cash in excess of $10M.

Key assumptions:
- 1200 terminals added each quarter
- Acquiring revenue of $1200 per quarter per terminal
- Acquiring margin ~ 52%
- Operating expenses (excluding acquiring COS) increases by 10%

[Mel]

Good headline numbers from SPY:
https://www.nzx.com/announcements/397652
Onwards and upwards. Good to see a material increase in the NPS score also

[Muse]

AGM tomorrow. It would be nice to get some guidance for FY23 or at least 1H.

I’m predicting FY23 Sales of ~$72M and EBITDA of ~ $23M. Closing cash in excess of $10M.

Key assumptions:
- 1200 terminals added each quarter
- Acquiring revenue of $1200 per quarter per terminal
- Acquiring margin ~ 52%
- Operating expenses (excluding acquiring COS) increases by 10%

Good stuff Coop. I couldnt make AGM - they say anything interesting or give any guidance?

[Co0p_New]

Yeah I sat in. All in all it was very positive.

Continue executing the strategy was the key message. Rightly so.

No plans to sell NZ ops or become an acquirer here. Androids terminals to be released before end of the financial year.

No guidance but I guess we will have 1H trading update in 6 weeks.

[Joshuatree]

Thanks CoOp,happy holder here.

[Muse]

Q2 revenue growth was a banga

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/SPY/400718/381388.pdf

Looking forward to seeing the half year accounts and the effects of operational leverage has on its earnings. Should be a cracker

[Co0p_New]

That is a stunning update. They have real momentum now.

Also wondering whether the increasing float (merchant funds) and increasing interest rates whether interest revenue will become material.

Really looking forward to the 1H accounts.

[Balance]

Q2 revenue growth was a banga

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/SPY/400718/381388.pdf

Looking forward to seeing the half year accounts and the effects of operational leverage has on its earnings. Should be a cracker

Up 15.6% since the update.

Looking like this could be the stock which could be the bolter of 2022?

[Muse]

Up 15.6% since the update.

Looking like this could be the stock which could be the bolter of 2022?

Just wait until the half year results are released showing the impact of operational leverage on the bottom line

Terrible liquidity though. Action is on the asx.

[Balance]

Just wait until the half year results are released showing the impact of operational leverage on the bottom line

Terrible liquidity though. Action is on the asx.

Did not realise it's a dual listed stock.

Depth certainly looks a lot better there - pretty much the case these days with all the dual listed stocks these days.

Looks like someone paid up on ASX yesterday to NZ81c!

[Balance]

Big volumes going through at rising share prices.

Looks like something is about to pop?

Have bought a few at 79c to go for the ride.

[Muse]

Big volumes going through at rising share prices.

Looks like something is about to pop?

Have bought a few at 79c to go for the ride.

Did you notice the crossing yesterday on the asx? :)

Half year report later this month.

More interest in the stock from existing shareholders as they get around to digesting the Q2 quarterly update (not on the top of anyones priority list so a bit of a lag).

Also one of smartpay’s main competitors - Tyro - has received a takeover offer from westpac. Piqued a bit more interest

[Balance]

Did you notice the crossing yesterday on the asx? :)

Half year report later this month.

More interest in the stock from existing shareholders as they get around to digesting the Q2 quarterly update (not on the top of anyones priority list so a bit of a lag).

Also one of smartpay’s main competitors - Tyro - has received a takeover offer from westpac. Piqued a bit more interest

Noticed the big crossings today on ASX too.

Well, the banks do tend to act in a pack - where one goes, the others follow.

So could be very rewarding times ahead for SPY!

I am in and added a few more.

[Rawz]

I bought in a few months ago when the moose from the fiordland started making loud bellows

Cheers FM!

[Balance]

I bought in a few months ago when the moose from the fiordland started making loud bellows

Cheers FM!

Louder please next time FM!

I am late to the party, enjoying the steak but champagne & crayfish are still available to be served soon?

[Muse]

TBH I'm new to the party I only starting accumulating this year. I bought an utterly insignificant parcel years ago which, if I hadn't, I dont think I'd have taken any notice of what Smartpay have been doing the last few years (I often do that just so I will take some notice of a company). It's been listed forever, its changed lots and people lost track of what it was, and until maybe ~4 years ago was just a roll up of some of the Provenco Cadmus assets bought out of receiverships. Was effectively a captive NZ business leasing EFTPOS machine with lots of debt used to fund some of the acquisitions, together with some weird convertible note causing havoc in the financial accounts. Pretty easy to miss right?

But to their credit they've rejuvenated the company. Raised capital and reduced debt, the convertible note is gone and don't have to suffer the brain damage of trying to understand what that was, smartly invested to develop the capability to move from being an eftpos leasing provider to an Australian transactional acquiring provider (where the economics are outstanding), got a new managing director cut from private company cloth who is highly focused on profitability and unit economics, found their differentiated niche in the Australian market and magnificently executed on their gameplan without plunging the company into losses to fund growth. Now profitable and cashflow generative and has been scaling. Oh yeah - has got $27m of off balance tax losses available to offset future tax.

Still lots I am trying to get my head around. Mainly on the industry and competitive situation. Never saw myself getting interested into a terminal business. Pleasing to see the board and management with rather chunky shareholdings and for a historically small and speccy company have got some great institutional investors who have been building their shareholding (Milford and Microcap equities)

Best guess for 1H FY23 (which moves around by the hour) is revenue $35.4m, EBITDA ~$9m (up ~150% on prior year) , and NPAT of ~$3m (up ~640% on PCP). That's the thesis - maybe buy a bit more if I'm right or close enough to it

[Muse]

....................

[Muse]

1.9 million shares crossed on the ASX today at AUD 0.77 (NZD 84c). Rolling 20 business day volumes now the highest since July 2021. At some point would expect to see some SSH notices filed. Will be interesting if a new investor coming on board (and who have they been buying from) or if Milford or Microequities are trading amongst themselves. Very good price discovery at these heavy volumes rather than the day to day movement in small trades.

Disc...have acquired a meaningful position over the last 6 months.

[Balance]

1.9 million shares crossed on the ASX today at AUD 0.77 (NZD 84c). Rolling 20 business day volumes now the highest since July 2021. At some point would expect to see some SSH notices filed. Will be interesting if a new investor coming on board (and who have they been buying from) or if Milford or Microequities are trading amongst themselves. Very good price discovery at these heavy volumes rather than the day to day movement in small trades.

Disc...have acquired a meaningful position over the last 6 months.

Actually, 2.9m shares crossed at A77c!

Going higher and higher on good volumes, albeit via crossings.

Most likely to be institutional investor(s) getting set and as I was told by Australian fund managers in years past, they do not mind paying up when they evaluate a stock as having 100% upside over a 3 to 5 years’ time frame.

[Muse]

Actually, 2.9m shares crossed at A77c!

Going higher and higher on good volumes, albeit via crossings.

Most likely to be institutional investor(s) getting set and as I was told by Australian fund managers in years past, they do not mind paying up when they evaluate a stock as having 100% upside over a 3 to 5 years’ time frame.

Sorry 2.9m - tad dyslexic - lets hope that doesn't happen when I wind up placing a bid!

Per my theory we've now had today a SSH from MA Financial Group (the recently rebranded Moelis Australia) who I had previously omitted as a major shareholder, as selling down a few million shares. They sold to someone, and they sold to someone large. If in a few days another SSH doesn't occur from either Milford or Microcap Equitiies that implies a new shareholder/acquirer is on the hunt, whether they wind up eventually breaching 5% or hover just below. Decent retail volumes in recent days following block trades.

[Muse]

Interesting to read today that Shaw & Partners said dual listed Smartpay was their highest conviction stock under coverage despite the run up in share price. Glad that I didn't wait to start buying before that little excerpt - I'm up about 35-40% on the smartpay shares I purchased this year in a down market.

Another special crossing today and good retail volumes (both on the asx where the action is).

Moved this from my specy portfolio to my core holdings and a long term holder.

[Balance]

880,000 crossed at A0.84c or NZ0.92c.

Looking better by the day indeed!

[Mel]

Interesting to read today that Shaw & Partners said dual listed Smartpay was their highest conviction stock under coverage despite the run up in share price. Glad that I didn't wait to start buying before that little excerpt - I'm up about 35-40% on the smartpay shares I purchased this year in a down market.

Another special crossing today and good retail volumes (both on the asx where the action is).

Moved this from my specy portfolio to my core holdings and a long term holder.
I'm a fan of SPY and I wish I had bought a more substantial stake. For transparency, Geoff Carrick is an independent director at Smartpay - and used to be Head of Corporate Finance at Shaw & Partners until 2019.

[RupertBear]

Interesting to read today that Shaw & Partners said dual listed Smartpay was their highest conviction stock under coverage despite the run up in share price. Glad that I didn't wait to start buying before that little excerpt - I'm up about 35-40% on the smartpay shares I purchased this year in a down market.

Another special crossing today and good retail volumes (both on the asx where the action is).

Moved this from my specy portfolio to my core holdings and a long term holder.

Well done that Moose! :t_up: I have been following this one for a while, but sadly missed the boat before it took off :mellow: I will look to buy a few on any weakness…..:)

[Rawz]

Is SPY the ultimate inflation hedge? Just clip the ticket of ever increasing prices

[kizame]

Taking into account higher interest rates and slower consumer demand?

[Rawz]

Taking into account higher interest rates and slower consumer demand?

Yes, I believe we are in a period of inflation that could run for a decade or so

[Mel]

Hit 0.95 today, hopefully breaching the $1 mark is only a matter of (short) time :)

[Balance]

Hit 0.95 today, hopefully breaching the $1 mark is only a matter of (short) time :)

Market is pricing in a very good result to be released late November or is there some takeover action at play (too)?

Couple of interesting weeks ahead.

[Muse]

Market is pricing in a very good result to be released late November or is there some takeover action at play (too)?

Couple of interesting weeks ahead.

aye I think its just momentum players catching up to trading going on amongst the institutional holders.

w/ tyro catching its second bid it does raise the question of M&A activity (from westpac, previously from potentia private equity). It was in 2019/2020 that SPY agreed to a bid to sell its NZ business for $70m before covid hit - verifone used comcom delays to back out and resubmit a lower bid which was rejected. But I really don't see that as a driver to the institutional trading, just the very good quarterly update where all pistons were on fire and building expectations for how that translates into the 1H financial result.

for a smallcap (even by NZ standards) smartpay has a great institutional shareholder base. Milford, Microequities asset mgmt, anacacia, ma financial (moelis) all as substantial holders, plus another clutch of insto's below the magic 5% (eg ACC, regal, jencay etc), a number high net wealths and self managed super funds, plus chunky holdings by mgmt and the board. The company has been well regarded for its proactive outreach to the aussie investment community.

given the inherent technology risk in the payments sector I reckon the insto's investment gameplan is a takeover at some point to a large trade player. I think it would be of interest to private equity (pretty sure it's already been looked at) but not sure they could get up to a value that reflects its growth potential and satisfies the instos who'd probably prefer to wait 5 years. I haven't looked at their weighted average entry prices but the big 4 pretty call the shots and the top 20 shareholders own 80% of the shares.

ideal speculation. the M&A aspect isn't part of my investment thesis though I don't mind having it on the horizon

[Balance]

Market is pricing in a very good result to be released late November or is there some takeover action at play (too)?

Couple of interesting weeks ahead.

Great interim results - excellent growth on all fronts.

Some serious momentum building up with this company - looks like all pistons firing.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/SPY/403119/384469.pdf

[Rawz]

gosh they read well.

probably see a whole new swath of investing want on board this train now that they are generating EPS. some simply wont invest until the company is profitable

[Rawz]

buyers on the asx market depth at 91 cents. applies nzx 98 cents :t_up:

[winner69]

buyers on the asx market depth at 91 cents. applies nzx 98 cents :t_up:

so be well over a buck by end of day :t_up::t_up::t_up:

[Rawz]

IKE and SPY now the new STr great race to $2

STU and MHJ stuck in neutral

I got a few bob each way :t_up::t_up::t_up::t_up:

[Joshuatree]

SPY a double bagger plus.Holding on for the ride:)

[Balance]

SPY a double bagger plus.Holding on for the ride:)

You have done well.

Got in a bit later myself but happy with the outstanding results and the momentum behind this company.

[Rawz]

its up 37% in the last 2 weeks :t_up:

[Muse]

Best guess for 1H FY23 (which moves around by the hour) is revenue $35.4m, EBITDA ~$9m (up ~150% on prior year) , and NPAT of ~$3m (up ~640% on PCP). That's the thesis - maybe buy a bit more if I'm right or close enough to it

Nice result and in line with what I expected. My revenue was identical to forecast, EBITDA (per their reporting regime) about 900k too high but my NPAT came in bang in line with actual. With something growing this fast every new set of financials helps to shed some light on where and at what level investment is being made. It looks sensible to me. Nice to see another 5% added to EBITDA margins. Good net cash generation.

Not as good as you Joshuatree only up a smidge under 50% but I'll take it, especially after moving this out of my higher risk / lower conviction NZX portfolio allocation (~15% total NZX holdings) to a core allocation this year (together with with BGP, CEN, EBO, FRE, GNE, HGH, MFT, SCL, SKL, SPK, SUM, and TRA, representing the balance). FWIW anything in the payments sector I reckon is inherently higher risk, but after doing the work was content with the growth/risk adjusted balance.

Disc. Decided not to pick up any more shares this AM - the market (eventually) clocked on too early after the 2Q KPI update (including myself where I added immediately post update). I'll be keenly watching the quarterly run rates from here and the SP in between updates. An investor in this (and all shares), not a trader.

[Balance]

its up 37% in the last 2 weeks :t_up:

Powering on towards $1.00 ��

[Balance]

Powering on towards $1.00 ��

And $1.00 it is on ASX.

[Balance]

There she pops …. :eek2:

[Muse]

pop

Marty - CEO - gave an interview this AM w/ Coffee Microcaps over in OZ - got quite a bullish impression on the aussie transactional terminals being deployed. Big trades over on the ASX +1m shares.

[Rawz]

https://www.nzx.com/announcements/403483

Milford buying more. Added another 3.5m+ shares to the stash.

[Muse]

Aye Milford have a lot of conviction on the stock - they have been buying from MA Financial.

One of the other major institutional holders, Microequities (whose founder is on Smartpay's board), had this to say post result:

“EFTPOS payments business Smartpay Holdings (ASX:SMP) reported 1H23 results with revenue growth of 68% to $35.4m and EBITDA growth of 116% to $8.1m. All metrics such as new terminal additions, revenue per terminal and gross margins are all outperforming expectations. Marketing spend has been stepped up and in the most recent quarter Smartpay showed accelerating new terminal additions. We remain long term supportive shareholders and believe the business can scale to many multiples”


Yesterday's presentation from Smartpay's CEO below. He has a strong handle on the financials and unit economics which is great.
https://www.youtube.com/watch?v=5_fbqjzxbxI

[DarkHorse]

Aye Milford have a lot of conviction on the stock - they have been buying from MA Financial.

One of the other major institutional holders, Microequities (whose founder is on Smartpay's board), had this to say post result:

“EFTPOS payments business Smartpay Holdings (ASX:SMP) reported 1H23 results with revenue growth of 68% to $35.4m and EBITDA growth of 116% to $8.1m. All metrics such as new terminal additions, revenue per terminal and gross margins are all outperforming expectations. Marketing spend has been stepped up and in the most recent quarter Smartpay showed accelerating new terminal additions. We remain long term supportive shareholders and believe the business can scale to many multiples”


Yesterday's presentation from Smartpay's CEO below. He has a strong handle on the financials and unit economics which is great.
https://www.youtube.com/watch?v=5_fbqjzxbxI

Just looked into these last week (while stuck home with covid) and I like what I see.
Seems to be particularly illiquid on NZX... wondering whether to just buy on ASX albeit a bit less advantageous for Kiwis. Any suggestions? Have you guys managed to buy them on NZX OK?

[Balance]

Just looked into these last week (while stuck home with covid) and I like what I see.
Seems to be particularly illiquid on NZX... wondering whether to just buy on ASX albeit a bit less advantageous for Kiwis. Any suggestions? Have you guys managed to buy them on NZX OK?

You actually get them cheaper on the NZX vs the ASX day to day!

Just put your bids 1c or 2c cheaper than ASX and you should get them.

Classic situation of a NZX stock being appreciated more on ASX than NZX.

[Ggcc]

Almost $1 for $1, but nz has very little on offer. Interesting stock this and one of my 5 choices to do really well in 2023

[nztx]

Almost $1 for $1, but nz has very little on offer. Interesting stock this and one of my 5 choices to do really well in 2023

One of mine too for the 2023 competition

[Ggcc]

One of mine too for the 2023 competition
It should be valued around $1.17nz-1.19nz

[nztx]

It should be valued around $1.17nz-1.19nz


Yes . looks that way

[Balance]

It should be valued around $1.17nz-1.19nz

The buyer(s) allow offers to build up and then, grab everything in sight up to the ASX price. That’s been the case for months and months.

[Ggcc]

The buyer(s) allow offers to build up and then, grab everything in sight up to the ASX price. That’s been the case for months and months.

There were about 30,000 shares sold recently at about $1.10. Where do you see this share getting to?

[Balance]

There were about 30,000 shares sold recently at about $1.10. Where do you see this share getting to?

Fiordland Moose has a better feel for SPY than I have so he may be able to comment much much better.

I note that consensus forecasts have been upgraded for F24 and F25 since the excellent interim results reported in Nov 2022 confirmed that SPY is on a high growth trajectory.

I must be frank and say that I would be contented after investing at 76c to see $1.00 (31% gain) by March 2023 so if it gets to $1.50 by end of 2023, I would be very happy.

[nztx]

I remember when these first ran on the very first announcement a few years ago - 30c up to 85c I think it was,
when first signs became evident of Oz and later the cancelled sale of the NZ Operations.

We have had Covid inbetween and now Aussie progress is well and truly happening

[nztx]

A bit cheaper on ASX than NZX at the moment - 3c AU cheaper + Au/NZD exchange :)

Guess the Aussies are still sleeping around the BBQ & haven't caught on just yet ? :)


https://hotcopper.com.au/asx/smp/

[nztx]

Just look at that - NZX close @ $1.225 today

Meanwhile ASX close today @ Au $1.12

The cobbers over the way must be away on an extended siesta ;)

[stoploss]

Just look at that - NZX close @ $1.225 today

Meanwhile ASX close today @ Au $1.12

The cobbers over the way must be away on an extended siesta ;)
113 AUD is best offer , @ .9203 that’s about bang on the money .

[Muse]

There were about 30,000 shares sold recently at about $1.10. Where do you see this share getting to?


Fiordland Moose has a better feel for SPY than I have so he may be able to comment much much better.

I note that consensus forecasts have been upgraded for F24 and F25 since the excellent interim results reported in Nov 2022 confirmed that SPY is on a high growth trajectory.

I must be frank and say that I would be contented after investing at 76c to see $1.00 (31% gain) by March 2023 so if it gets to $1.50 by end of 2023, I would be very happy.

I sorta feel short term where she goes no-one knows (ain't that the case BlackPeter). I'm loathe to suggest any price targets or advice but I've got a few perspectives you could consider as part of doing your own research.

Most if not all the run up in price from c.90c has been done by retail. There was significant trading and net accumulation by institutions that lifted the SP from c.65c to 90c after the Q2 trading update and subsequent 1H FY23 results, and retail took it from there. Institutions own a large percentage of smartpay so it was more akin to one large holder accumulating, another not yet a SSH accumulating (speculation), and one taking a wee bit of money off the table. I think these sort of reshuffles occur after results and they go into hibernation, with particularly large breaks in December and January - so thats not to say they won't be back.

I regard large bid ups by retail as more speculative and volatile. The share has run hard - up nearly 2x from its ~65c bottom in 2022, so wouldn't be surprised to see the odd profit taking which can reverse the trend.

Thats my very short term perspective.

Institutions and investors will be quite focused on quarterly trading updates and the full year result to 31 March. Given the share price has run hard and has embedded growth expectations, any little stumble could alarm investors and traders, and reinforce disciplined trading amongst institutions. Ultimately at these quarterly intervals I see retail money following the strong price signals set by the large block trades to the extent they occur. Its possible net terminal deployments in Australia could prove to be inconsistent - one really strong quarter, followed by a breather from the company, followed by a catch-up in the following period - it may not prove to be a smooth intra year growth pattern even if the annual growth looks consistent. So if I were a trader (I'm not) I'd have my eye on that.

I only give regard to these catalysts for short term price volatility for buying opportunities, and out of plain old interest. I have a much longer investment horizon assuming my investment thesis plays out.

Longer term its my view that the company will be a meaningfully more valuable one in the future (say 5 years) than it is today, and am more confident about longer term price trends than shorter term trends. I'm slightly more bullish on FY23 than consensus, less so in FY24-25 (as for my own purposes I bake in a meaningful reduction in the # of transaction volumes per terminal on account of a deterioration in the economy, together with some mix changes in customers resulting in a slight compression in average ticket size), but still resulting in strong earnings growth in those periods, and particularly thereafter. I won't bore you with my assumptions and I'd encourage you to come up with your own estimates, but I reckon the company has a better than not chance of generating in FY27 reported EBITDA of ~$58m , EBIT of $39m, and NPAT of ~36m (slightly artificially high as it could be the last period where it is able to utilise some of its tax losses). Reckon it could have between $50-60m of net unrestricted cash and have paid dividends along the way starting in FY25. I believe it would still have good growth ahead but the marketshare land grab would only have a few years left so realistic, reasonable and prudent multiples to capitise those earnings by could be warranted, and discount that back to a present value based on your own required returns for a business of this nature (high growth assumes reasonably aggressive assumptions which I believe should be compensate by higher returns and discount rate, together with inherent long term risk in the payment industry). Happy to talk more about that or via PM if you were keen to share notes. Those future reported EBITDA and EBIT figures are IFRS 16 (so deduct say ~1.2m for leases and grow how you see fit) and don't include share issue expenses, so you could deduct another say 1.5m and grow, and capitalise those adjusted figures, as that's how i look at it. NPAT more or less comes out the same and needs no adjustment.

That's how I look at it, and my thoughts evolve as any investors should.

I'm stoked more with the performance of the company than my paper gains, but I'll take them gains no matter how fleeting they may be on a daily basis. But at the end of the day I remind myself that run rates are intoxicating when they are on the way up, and sobering on the way down.

[Muse]

One of mine too for the 2023 competition

Ditto.

Q3 result out I believe on 20 January, or thereabouts.

I note only one brave soul chose it in the 2022 stock picking contest (some moose) - offset by my harmoney pick :scared:

[Rawz]

Thanks FM for your quality post. Gosh we are so lucky that you share your thinking with such detail.

I’m currently up 70% and only discovered this after your started ringing the alarm bells on sharetrader.

[Ggcc]

Fiordland Moose has a better feel for SPY than I have so he may be able to comment much much better.

I note that consensus forecasts have been upgraded for F24 and F25 since the excellent interim results reported in Nov 2022 confirmed that SPY is on a high growth trajectory.

I must be frank and say that I would be contented after investing at 76c to see $1.00 (31% gain) by March 2023 so if it gets to $1.50 by end of 2023, I would be very happy.
At this rate you might be happy next week if it gets to $1.50 lol. Too bad I missed out picking more up that is.

[nztx]

At this rate you might be happy next week if it gets to $1.50 lol. Too bad I missed out picking more up that is.


It certainly appears to have legs, and could be the next runaway :)

[Sideshow Bob]

Trading Update

https://www.nzx.com/announcements/405514

[Rawz]

Trading Update

https://www.nzx.com/announcements/405514

Growth still looking good.

I always like reading the management outlook commentary:

Q1 Outlook was:
With acceleration in our Australian customer acquisition and improvement in New Zealand trading conditions, Q1 FY23 has further improved from the growth momentum delivered in FY22. As we scale further into our Australian opportunity, and ultimately increase the breadth of awareness of our unique Australian customer proposition, it is clear our solution is resonating strongly with our target market.

Q2 Outlook was:
Accelerated growth momentum continues, setting the foundation for a strong second half to FY23 With further acceleration in customer acquisition resulting in improvement in our key metrics in quarter two FY23, we are seeing an immediate return on our increased investment in marketing and sales. This strong start to FY23 sets a a solid foundation for the remainder of the financial year.

Q3 Outlook today is:
With acceleration in customer acquisition continuing and an ongoing measured approach to investment in growth, we look towards a strong finish to the 2023 financial year.

[Co0p_New]

Nice update. In past years the Q3 terminal adds have been subdued so nice to see continued strong growth this year. FX being a drag is a bit of a bummer.

[Balance]

Fiordland Moose has a better feel for SPY than I have so he may be able to comment much much better.

I note that consensus forecasts have been upgraded for F24 and F25 since the excellent interim results reported in Nov 2022 confirmed that SPY is on a high growth trajectory.

I must be frank and say that I would be contented after investing at 76c to see $1.00 (31% gain) by March 2023 so if it gets to $1.50 by end of 2023, I would be very happy.

$1.38 after the update!

Could be $1.50 soon!!!!!

[Rawz]

$1.38 after the update!

Could be $1.50 soon!!!!!

The SP needs to keep going up or someone big will come along and take it over!

[Muse]

$1.38 after the update!

Could be $1.50 soon!!!!!

Well we all know what the resistance will be when balance takes his profits!

Happy days.

[Balance]

Well we all know what the resistance will be when balance takes his profits!

Happy days.

Happy holder.

Let your profits run and cut your losses.

Should have bought more I guess and under $1.00 not that long ago!!!

[Ggcc]

Happy holder.

Let your profits run and cut your losses.

Should have bought more I guess and under $1.00 not that long ago!!!
I hope to be saying the same when Task release their quarterly figures. I wish I bought more at 37 cents

[Rawz]

Aussies ruined the rally

[nztx]

She got legs again :)

[Balance]

She got legs again :)

Cannot keep a good thing down.

$1.50 … here we come?

[Muse]

Aussies ruined the rally

aussies back to the game

immature chant follows
lets go smartpay *thump thump thumpthumpthump* lets go smartpay *thump thump thumpthumpthump*

[nztx]

$1.30 AU currently

[Rawz]

Another strong day for SPY.
People having to pay up as sellers are few and far between.

Still looks undervalued imo considering their rapid revenue growth. You look at some of the multiples that these loss making entities like Serko trade at… smartpay has a long way to run.

Could hit the $1.75-$2 range if the next update is solid and all signs are pointing to another strong update given their outlook commentary on Q3

Disc. Happy holder

[percy]

Well done holders,a fantastic run.

[nztx]

Exit .. up up and flew away .. all good things only rise a certain amount .. before ..

A nice ride .. thanks boys & girls :)


will be watching to see if there is another chance for some more fly up up and .. another day

[Rawz]

NZTX you got off the rocket ship too early...

Not sure you will get another chance :scared:

[nztx]

NZTX you got off the rocket ship too early...

Not sure you will get another chance :scared:


Can't be too greedy .. got to leave something in the bucket for others coming in


I'm riding the next now .. will let you what & where that is when the ride finishes :)

[Rawz]

Can't be too greedy .. got to leave something in the bucket for others coming in


I'm riding the next now .. will let you what & where that is when the ride finishes :)

um pretty sure thats not how it works.. if you want the credit you post before the ride otherwise anyone can say they were on the boat after the fact ;)

[nztx]

Hey come on .. I book the credit for finding the untouched good fruit and already share
a fair few of the clues :)

[Muse]

Quite a chunky $4.3m off market trade today on the NZX. First time I've seen a crossing that wasn't on the asx.

[Balance]

Quite a chunky $4.3m off market trade today on the NZX. First time I've seen a crossing that wasn't on the asx.

Excellent sign that someone believes the story and has to pay up to get stock.

[Muse]

Announcement released showing Smartpay added to the S&P ASX All Ordinary index, effective 20 March.

[percy]

SPY share price in NZ $1.28
SMP,share price in Aussie .S1.10.
Currency au$1.00 concerts to NZ $1,20
Cheaper buying in Aussie by about 6.25%
I wonder why.?

[Ggcc]

SPY share price in NZ $1.28
SMP,share price in Aussie .S1.10.
Currency au$1.00 concerts to NZ $1,20
Cheaper buying in Aussie by about 6.25%
I wonder why.?
Interesting to see that Greg Tomlinson is a big investor in SPY.

[dln]

SPY share price in NZ $1.28
SMP,share price in Aussie .S1.10.
Currency au$1.00 concerts to NZ $1,20
Cheaper buying in Aussie by about 6.25%
I wonder why.?

You need a better FX dealer ...
1.0876 currently

[percy]

Interesting to see that Greg Tomlinson is a big investor in SPY.

He is well worth following.

[Muse]

* responded to wrong quote

[Muse]

Interesting to see that Greg Tomlinson is a big investor in SPY.

Is he? I must have missed that somehow. Where'd you pick that up?

[Ggcc]

Is he? I must have missed that somehow. Where'd you pick that up?

https://www.marketscreener.com/quote/stock/SMARTPAY-HOLDINGS-LIMITED-21387383/company/

Look under shareholders

[Muse]

https://www.marketscreener.com/quote/stock/SMARTPAY-HOLDINGS-LIMITED-21387383/company/

Look under shareholders

Cheers Ggcc

[Muse]

About 2.75 million shares traded today across the NZX & ASX, with bulk of that coming from two off market trades for about NZ$3.3m.

Suspect in anticipation of the Q4 trading update which should be in hand by next Thursday or Friday.

Looking forward to that.

[Balance]

About 2.75 million shares traded today across the NZX & ASX, with bulk of that coming from two off market trades for about NZ$3.3m.

Suspect in anticipation of the Q4 trading update which should be in hand by next Thursday or Friday.

Looking forward to that.

Moving up nicely.

Should be another great result!

[Muse]

Moving up nicely.

Should be another great result!

I hope so.

My Q4 guesses:
* AU acquiring revenue of ~NZ$17.4m, up 82% year on year
* Other revenue (mainly NZ terminal leases & misc. other bits and bobs) of 4.4m, up about 2.3%
* Consolidated revenue of $21.7m, up 57.5% year on year
* Brings full year revenue to $78.3m, up 63%
* Precision in the end numbers not the goal - its direction and magnitude of the rate of change in the individual components that matters

We don't usually get any detail on profitability at the quarterly updates (only at half and full year) so will have to wait a while yet to get the full year result. Picking the expenses more difficult in my view than the revenue.

But as it stands I'm a tad above consensus for NPAT for the 12 months just been, and and about ~12% above consensus for the now current year FY24, and 11% above FY25 consensus.

disc: happy holder.

[Muse]

Wilson Asset Management been on the buyside of recent block trades (probably acquiring most from MA Financial as they rebalance) and buying on market. Started buying in December, now own 5.8% of sharecap, supplementing the already very good institutional coverage (for a smallcap).

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/SPY/410078/392769.pdf

[Co0p_New]

Looking forward to the trading update - must be close.

Holder since sub 20c, so very happy :-)

Will let this one continue to run.

[Mel]

Trading update - reads well, upward trajectory continues
https://www.nzx.com/announcements/410443

[Muse]

Yes. Fantastic to have a full year complete - clean - without lockdowns etc. Now we have a pretty clear picture of what this business is able to achieve and the seasonality pattersn.

I have no idea what the Strategic Update and the non binding letter of intent re the NZ fleet is. "Provides a path to present our next generation android terminal and acquiring solution to our loyal NZ customers."

I didn't think the acquiring solution was practical in NZ given the structural differences in the OZ and NZ market.

[Muse]

Well the Australians like it - up 5% straight out of the gate to A$1.35 (equates to 1.46 kiwi at spot) - over A$500k traded already.

Something about that Strategic Update to unlock the value of the NZ fleet got people interested. And another quarter of fantastic growth.

[Muse]

NZ$6.1m turnover on the ASX. Lets not forget add the $21k to that trading on the NZX (lol, sigh)

Looks like the biggest daily volume for at least 2 years.

[Mel]

NZ$6.1m turnover on the ASX. Lets not forget add the $21k to that trading on the NZX (lol, sigh)

Looks like the biggest daily volume for at least 2 years.
Thanks for pointing that out slight difference in liquidity :), don't follow the ASX trading, so very insightful.

[Muse]

Often some price differentials between the two, even adjusting for fx. Most of my shares on the ASX but I did last year pick up quite a few tranches on the NZX when it was cheaper to do so. Liquidity better on the ASX so if one was to ever sell could transfer holding to that exchange.

Balance SPY hit your magic number of +NZ$1.50 on the ASX yesterday, opening looks highly encouraging as well.

[Mel]

Often some price differentials between the two, even adjusting for fx. Most of my shares on the ASX but I did last year pick up quite a few tranches on the NZX when it was cheaper to do so. Liquidity better on the ASX so if one was to ever sell could transfer holding to that exchange.

Balance SPY hit your magic number of +NZ$1.50 on the ASX yesterday, opening looks highly encouraging as well.
And now $1.50 on NZX also :)

[winner69]

This MA FINANCIAL GROUP probably just taking some profits

Mind you they’ve sold down a couple of times last year

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/SPY/410672/393451.pdf

[Muse]

Wilsons Asset Management have emerged as a new substantial holder this month (disclosing initial SSH 17 April) with much of it through block trades as well as on market purchases. Those blocks coming from MA Financial (the old Moelis).

[Mel]

My best performing stock has now passed $1.60 (NZX), $1.55 (ASX).....YAY - Counters some of my losses with other stocks :)

[Balance]

Outstanding performance by SPY! Shaping up to be stock of the year! :t_up::t_up:

[Ggcc]

Great stock, but at what stage does it become overvalued?

[Rawz]

Well done holders. I sold this too early and HLG too early and now I'm sitting here like a potato watching everyone else having fun :eek:

[Balance]

Well done holders. I sold this too early and HLG too early and now I'm sitting here like a potato watching everyone else having fun :eek:

Always leave something for the next holder.