The EML Payments Ltd (ASX: EML) share price went bananas on Wednesday, it jumped 10.3% in reaction to the FY19 result.
EML Payments develops financial technology to provide solutions for payouts, gifts, incentives & rewards and supplier payments. It issues mobile, virtual and physical cards to some of the largest corporate brands, processing billion of payments each year, managing more than 1,400 programs across 23 countries in North America, Europe and Australia.
Here’s What EML Payments Reported
EML Payments reported that its group total debit volume increased by 34% to $9.03 billion. This translated to a rise of group revenue of 37% to $97.2 million.
Each of EML Payment’s segments contributed to the revenue growth. Gift & Incentive revenue grew by 42%, General Purpose Reloadable revenue rose 11% and Virtual Account Numbers revenue rose 165%.
Group EBITDA (click here to learn what EBITDA means) rose by 40% to $29.1 million, which included $0.6 million of acquisition expenses.
Management had given revenue guidance of $88 million to $94 million and EBITDA guidance was $27 million to $28 million. Both parts of the guidance were beaten.
Group net profit after tax (NPAT) rocketed 283% higher to $8.5 million.
In terms of cashflow, EML Payments generated $22 million including the one-time benefit of $7.1 million in accelerated breakage cash receipts.
EML Payments ended FY19 with $33.1 million of cash and a $15 million loan from a major Australian bank. The loan was to purchase Flex-e-Card.
The company also said that during the year it launched its Pays technology in Australia, which encompasses Apple Pay, Google Pay and Samsung Pay to enable clients to reach customers instantly. It’s expected to launch in Europe and North America by the end of 2019.
Is The EML Share Price A Buy?
EML Payments is predicting further profit growth from new & existing programs, full year contributions from FY19 acquisitions, new salary packaging benefits, new services, higher profit margins and a focus on reducing costs where possible.
EML Payments is certainly one to keep an eye on with how fast it’s growing, but I’m unsure of how to assess the potential growth and opportunity for EML Payments. I find it easier to think about the exciting growth shares in the free report below.
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