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INVESTOR BRIEFING H1 FY25 Results 26 February 2025 Tyro Payments Limited ABN 49 103 575 042 For personal use only
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DISCLAIMER This presentation is provided by Tyro Payments Limited (ABN 49 103 575 042) and its controlled entities (variously, “Tyro”, “us”, “we”, “our” and “Group”) and is current at 26 February 2025. It is information given in summary form only and does not purport to be complete. It does not constitute personal, legal, investment, taxation, accounting or financial product advice, has been prepared as general information only, and does not take into account your personal circumstances, investmentobjectives, financial situation, tax position or particular needs. Having regard to those matters, please consider the appropriateness of the information before acting on it and seek professional advice. No information herein constitutes an offer, solicitation or invitation to apply for securities, or any other financial product or service, or to engage in any investment activity, in any place in which, or to any person to whom, it would be unlawful to make such an offer, solicitation or invitation. This presentation contains statements that are, or may be deemed to be, forward-looking statements. To the extent the information may constitute forward-looking statements, it reflects Tyro’s intent, belief or current expectations at the above date. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, assumptions and uncertainties, many of which are beyond Tyro’s control, which may cause actual results to differ materially from those expressed or implied. Undue reliance should not be placed on any forward-looking statement and, other than as required by law, Tyro does not give any representation, assurance or guarantee that the occurrence of the events, results and outcomes expressed or implied in any forward-looking statement will actually occur. Subject to any continuing obligations under applicable law, we expressly disclaim any obligation to provide any updates or revisions to any forward-looking statements in this presentation to reflect events or circumstances after the above date. There are a number of other important factors that could cause actual results to differ materially from those set out in this presentation. This presentation includes unaudited financial information and “non-IFRS financial information” under ASIC Regulatory Guide 230.We consider this information provides a useful means to understand our performance, however, such information does not have a standardised meaning under the Australian AccountingStandards or International Financial Reporting Standards. Undue reliance should not be placed on it. No representation, warranty or undertaking, express or implied, is made and no responsibility is accepted by Tyro as to the accuracy, currency or completeness of any part of this presentation. All amounts are in Australian dollars. Past performance information given in this presentation is for illustrative purposes only and should not be relied upon as, and is not, indicative of future performance. For personal use only
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INTRODUCTION Jon Davey CEO and Managing Director AND SUMMARY For personal use only
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WHERE WE’VE COME FROM 4 2.8 33.0 H1 FY22 H1 FY25 -11.2 10.5 H1 FY22 H1 FY25 18% CAGR Gross profit1 12x EBITDA2 $21.7m Profit before tax3 1 Gross profit (normalised), displayed in $ millions. 18% CAGR for 3 years to H1 FY25. 2 EBITDA and EBITDA margin (normalised), displayed in $ millions. 12x improvement in EBITDA from H1 FY22 to H1 FY25. 3 Profit before tax (normalised), presented in $ millions. $21.7m increase in PBT from H1 FY22 to H1 FY25. Note: Totals and movements based on unrounded numbers. 4.1% margin 29.5% margin 68.1 112.0 H1 FY22 H1 FY25 For personal use only
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GROWTH IN HEALTH AND IMPROVED OPERATING EFFICIENCY 5 1 Chart displays TTV in $bn. Tyro Health TTV for FY25 on run-rate basis using H1 FY25 growth rate applied to total FY24 volumes. 2 Operating efficiency defined as operating expenses as a percentage of gross profit, on a normalised basis, displayed as a percentage. FY19 Health FY19 Retail FY19 Hospitality FY25 Health Tyro discretionary verticals at IPO Tyro Health today1 >$7bn Our operating efficiency has improved significantly2 Tyro Health is large, and growing fast H1 FY22 H1 FY25 >90% c.70% $7.1bn $6.5bn $2.4bn For personal use only
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ON TRACK TO DELIVER FY25 GUIDANCE 1 Gross profit and EBITDA margin on normalised basis. 6 EBITDA MARGIN1 FY25 GUIDANCE: c.28% H1 FY25 29.5% Strong EBITDA margin supported by gross profit growth and continued cost discipline. GROSS PROFIT1 FY25 GUIDANCE: $218m – $226m (3-7% growth) H1 FY25 $112.0m (+6.5% vs PCP) Payments +6.0% supported by higher payment margin. Banking +9.1% supported by increased revenue from lending and lower deposit costs. For personal use only
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INVESTING IN KEY BUILDING BLOCKS FOR FUTURE GROWTH with positive momentum on integrated payments and banking strategy HIGHER EBITDA FROM TOP-LINE GROWTH AND EFFECTIVE COST MANAGEMENT On track to deliver FY25 guidance 7 WELL POSITIONED TO DELIVER PROFITABLE GROWTH while navigating the evolving external environment H1 FY25 RESULTS: KEY THEMES For personal use only
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INVESTING IN THE BUILDING BLOCKS FOR GROWTH IN PAYMENTS 8 SOME MERCHANTS WANT US TO PROVIDE A DEVICE SOME MERCHANTS WANT TO BRING THEIR OWN DEVICE SOME JUST WANT OUR PAYMENT TECH Enabling new partners to build better services by leveraging our payments capabilities • Development and go-to-market work underway for Unattended Devices and Health-adjacent vertical • Both verticals on track to contribute to gross profit from FY26 Through our embedded payments SDK, we’re enabling payments on any device • 3 POS providers now certified and live with embedded payments • 17 additional POS providers in development • Increasing adoption with positive merchant feedback We’re modernising our fleet with next-generation terminals and developing new terminals for SME sub-segments • 3G shutdown successfully navigated • Tyro Pro and Pro Key rolling out across our network • Development of new terminals for micro merchants For personal use only
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GIVING MERCHANTS MORE WAYS TO GET PAID 9 For personal use only
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10 HOUSEHOLD HEALTH SPEND $100bn+ per annum1 Growing at: 9% CAGR1 TYRO HEALTH TTV $7bn+ Run-rate2 Growing at: 24% CAGR3 1 Source: ABS Monthly Household Spending Indicator December 2024. 3- year CAGR from December 2021 to December 2024. 2 >$7bn annual TTV run-rate based on H1 FY25 TTV of $3.6bn with FY25 growth consistent with H1 FY25 growth Compound Annual Growth Rate for 3-year period from H1 FY22 to H1 FY25. 3 Compound Annual Growth Rate for 3-year period from H1 FY22 to H1 FY25 WE CONTINUE TO GROW FAST IN TYRO HEALTH For personal use only
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11 INVESTING TO TAKE GREATER SHARE OF HEALTH PAYMENTS OMNICHANNEL EXPERIENCE NEXT-GEN TERMINAL TYRO HEALTH ONLINE For personal use only
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11% 15% 21% 25% Jun-23 Sep-23 Dec-23 Mar-24 Jun-24 Sep-24 Dec-24 POSITIVE TRENDS DEMONSTRATE THAT MERCHANTS VALUE BANKING PROPOSITION 1 Active Tyro Bank Accounts, >2,200 compares with H1 FY24. 2 Front-book adoption is the percentage of new, actively transacting, merchants that open a Tyro Bank Account within 1 month of joining Tyro. 3 Net promotor score for merchants that have a Tyro Bank Account, and for merchants that have a Tyro Bank Account and have usedour cashflow product. NPS data as at November 2024. 12 >2,200 New active accounts1 5,362 6,015 6,725 7,643 8,987 H1 FY23 H2 FY23 H1 FY24 H2 FY24 H1 FY25 +34% Front-book adoption2 Net promotor score3 24 62 Tyro Bank Account Lending >25% For personal use only
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HIGH PERFORMING TEAM TO DRIVE NEXT PHASE OF GROWTH 13 EVOLVING OUR TECH OPERATING MODEL Focus on improving execution, creating greater capacity for investment, and driving a digital-first customer experience Emma Burke CFO Steve Willson CTO Steen Andersson CPO HIGH PERFORMANCE CULTURE Embedding a growth and innovation mindset, hiring top talent and rewarding high performance RECENT LEADERSHIP HIRES For personal use only
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FINANCIAL Emma Burke CFO PERFORMANCE For personal use only
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95.2 105.2 112.0 H1 FY23 H1 FY24 H1 FY25 19.5 27.3 33.0 20.4% 26.0% 29.5% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 0 5 10 15 20 25 30 35 40 45 H1 FY23 H1 FY24 H1 FY25 TOP-LINE GROWTH AND CONTINUED EBITDA MARGIN EXPANSION 1 Gross profit (normalised). 2 EBITDA and EBITDA margin (normalised). 3 On-track to deliver previously announced FY25 guidance: gross profit of between $218-226 million, and an EBITDA margin of c.28% for the full year. Note: Totals and movements based on unrounded numbers. GROSS PROFIT1 GROWTH +6.5% Free Cash Flow ($m)EBITDA ($m) and EBITDA margin (%) 2 +20.6% Gross Profit ($m) IMPROVING EBITDA MARGIN CONTINUED STRONG CASH GENERATION 15 On-track3 On-track3 0.6 10.4 9.0 H1 FY23 H1 FY24 H1 FY25 For personal use only
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105.2 112.0 10.5 4.9 0.2 0.5 0.6 H1 FY24 Payments Revenue Payments Direct Expenses Banking Revenue Deposit Costs Corporate & Other H1 FY25 GROSS PROFIT GROWTH DRIVEN BY PAYMENTS 161 Gross profit and drivers on a normalised basis. Totals based on unrounded numbers. Higher company cash balanceRoll-off of higher cost funding Pricing transformation Non-discretionary TTV growth Gross Profit1 ($m) For personal use only
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TOP-LINE DRIVEN BY IMPROVED MARGIN AND GROWTH IN HEALTH 1 Payments margin is for all of Tyro, inclusive of Bendigo. 2 New Business Written (NBW) is the TTV processed within the first calendar month for new merchants. 17% increase in NBW covers new merchants across all of Tyro, 22% increase is for Tyro Retail and Hospitality only. Note: Totals and movements based on unrounded numbers. PAYMENTS TTV ($bn) 17 9.5 9.1 5.4 5.3 3.1 3.6 1.7 1.7 2.5 2.2 H1 FY24 H1 FY25 Hospitality Retail Health Service/Other Bendigo FRONT-BOOK VOLUMES SHOWING POSITIVE MOMENTUM2… +17% +22% Retail & Hospitality 22.2 22.0 +11.1%Non-discretionary (incl. Health) Core discretionary Bendigo Tyro core -3.2% -10.7% +0.3% 40.7 42.7 41.8 45.3 44.7 32.7 33.8 33.7 37.1 37.6 H1 FY23 H2 FY23 H1 FY24 H2 FY24 H1 FY25 Gross Margin Net MAF PAYMENT MARGIN1 (basis points) Tyro …AND STRONGER IN OUR DISCRETIONARY VERTICALS For personal use only
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80.1 84.1 H1 FY24 H1 FY25 67.9 74.7 H1 FY24 H1 FY25 IMPROVED RETURNS ACROSS LENDING AND DEPOSITS 1 Deposit balances held within the Tyro Bank Account, excludes Term Deposits. Balances displayed in $ millions. 2 Value of loans originated in the period H1 FY25 (and H1 FY24). Originations displayed in $ millions. 3 Net return on banking and net return on loans includes any fair value gain/loss on loans and includes the loan loss expense. 18 HIGHER BANK ACCOUNT BALANCES Tyro Bank Account balances ($m) 1 GROWTH IN LOAN ORIGINATIONS Loan originations 2 IMPROVED RETURNS3 20.6% 28.4% 2.2% 3.1% 10.2% 14.2% H1 FY24 H1 FY25 Net Return on Loans Net Return on Deposits Net Return on Banking +5% +10% Banking gross profit $7.8m (+9.1% vs PCP) For personal use only
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EXPENSES WELL MANAGED LEADING TO IMPROVED OPERATING EFFICIENCY 19 1 Operating expenses exclude lending and non-lending losses, normalised. 2 Operating jaws is defined as the gap between gross profit and operating expenses (excluding lending and non-lending losses). Prior period expenses have been adjusted to be consistent with basis for H1 FY25 normalised expenses Displayed in $ millions. Operating expenses as % of gross profit 1 81.6% 75.3% 72.1% 70.3% 69.0% 77.7 73.8 75.8 74.3 77.3 95.2 98.0 105.2 105.6 112.0 H1 FY23 H2 FY23 H1 FY24 H2 FY24 H1 FY25 Operating expenses Gross profit 17.5 Operating jaws2 24.2 29.4 31.3 34.7 +6.5% +1.9% YoY growth Continued improvement in operating efficiency Disciplined expense management creating capacity for investment H2 expenses to be higher due to pay increases and timing of investment spend Expenses being managed to support target EBITDA margin For personal use only
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ROBUST BALANCE SHEET WITH HIGH LEVELS OF CAPITAL AND LIQUIDITY TOTAL CAPITAL ($M) & TOTAL CAPITAL RATIO (%) Capital Management • Tyro Employee Share Trust completed the purchase of $3.8m of shares in H1 FY25 • Actively exploring opportunities to deploy surplus capital via strategic opportunities, enhancing Tyro's product delivery, and/or return of capital LIQUID ASSETS ($M) AND MINIMUM LIQUIDITY HOLDING RATIO (%) 20 129.1 138.0 128.7 49% 56% 57% -100.00% -80.00% -60.00% -40.00% -20.00% 0.00% 20.00% 40.00% 60.00% 0 20 40 60 80 100 120 140 160 180 Dec 2023 Jun 2024 Dec 2024 102.8 124.9 143.0 53% 65% 73% -100.00% -80.00% -60.00% -40.00% -20.00% 0.00% 20.00% 40.00% 60.00% 80.00% 0 20 40 60 80 100 120 140 160 180 Dec 2023 Jun 2024 Dec 2024 For personal use only
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5.1 10.3 6.8 1.5 0.3 0.7 3.1 1.7 5.0 H1 FY24 Gross profit Operating expenses Lending & non- lending losses Share-based payments Depreciation & amortisation Impairment of banking intangible Bendigo-related and other items H1 FY25 1 EBITDA and its constituent parts (gross profit, operating expenses and lending & non-lending losses), share-based payments and depreciation and amortisation are on a normalised basis. Movements in EBITDA not captured within normalised performance are captured in other movements. 2 Other items includes the Bendigo intangible impairment and remeasurement of commission liability in H1 FY24, and the share of gains/losses on associates. Totals based on unrounded numbers. 21 EBITDA1 $5.6m higher • Profit before tax in H1 FY25 includes a $1.7m impairment of intangible assets related to banking platform software • H2 FY25 profit before tax will likely decline vs PCP due to the non-recurrence of c.$10m one-off from compensation and remediation in H2 FY24 Statutory profit before tax ($m) 2 Predominantly relating to Bendigo-related adjustments STATUTORY PROFIT SUPPORTED BY LOWER NON-RECURRING ITEMS For personal use only
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22 TOP-LINE GROWTH EBITDA MARGIN EXPANSION ON TRACK FOR FY25 GUIDANCE SUMMARY For personal use only
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OUTLOOK Jon Davey CEO and Managing Director For personal use only
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UNIQUELY POSITIONED TO DELIVER PROFITABLE GROWTH 24 TO DELIVER PROFITABLE GROWTH GROWTH IN ADDRESSABLE MARKET IMPROVED CUSTOMER ECONOMICS IMPROVED PROFITABILITY WE WILL LEVERAGE OUR STRENGTHS SCALABLE, PROPRIETARY PAYMENTS TECH TARGETED DISTRIBUTION CHANNELS INTEGRATED PAYMENTS AND BANKING EXTERNAL ENVIRONMENT PRESENTS OPPORTUNITIES • Positive on changes from RBA Payments Review; see opportunities to acquire new merchants • Improvements in economic conditions and consumer spending provide tailwind to payment volumes • Valuable strategic opportunities exist to deploy surplus capital to build scale and create greater shareholder value For personal use only
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ON TRACK TO DELIVER FY25 GUIDANCE 1 Gross profit and EBITDA margin on normalised basis. 2 Refer to FY24 Investor Briefing presentation for further detail on Rule of 40. Captures gross profit growth and EBITDA margin on normalised basis. 25 EBITDA MARGIN1 FY25 GUIDANCE: c.28% MEDIUM-TERM TARGET: Rule of 40 from FY262 GROSS PROFIT1 FY25 GUIDANCE: $218m – $226m For personal use only
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Q&A Jon Davey CEO and Managing Director Emma Burke CFO For personal use only
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APPENDIX For personal use only
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SUMMARY OF FINANCIAL PERFORMANCE 28 H1 FY25 $’000 H1 FY24 $’000 Change % Transaction value 21,971,420 22,173,537 (0.9%) Revenue (normalised)1 248,310 237,058 4.7% Payments direct expenses (including Bendigo Alliance gross profit share) (135,730) (130,792) 3.8% Interest expense on deposits (598) (1,099) (45.6%) Total direct expenses (136,328) (131,891) 3.4% Gross profit (normalised)2 111,982 105,167 6.5% Operating expenses (excl. share-based payments and lending and non-lending losses) (77,269) (75,797) 1.9% Lending and non-lending losses (1,717) (2,022) (15.1%) Total operating expenses (78,986) (77,819) 1.5% EBITDA (normalised)3 32,996 27,348 20.6% Share-based payments expense (2,004) (1,320) 51.9% Depreciation and amortisation (18,027) (14,903) 21.0% Impairment of intangible asset (1,747) - Large EBIT 11,218 11,125 0.8% Other interest expense (670) (712) (5.9%) Profit before tax (normalised)4 10,548 10,413 1.3% Statutory items (292) (5,275) (94.5%) Profit before tax (statutory) 10,256 5,138 99.6% Income tax - - - Profit after tax (statutory) 10,256 5,138 99.6% 1 Normalised revenue is adjusted to exclude the gain on remeasurement of the commission liability related to the Bendigo Alliance. 2 Normalised gross profit is adjusted to reflect the Bendigo Alliance gross profit share not deducted from statutory gross profit but reflected within the movement on commission liability relating to the Bendigo Alliance. 3 Tyro uses EBITDA as a non-IFRS measure of business performance, which excludes the non -cash impact of share-based payments expense, share of gain or loss from associates, the non-cash accounting impact of the Bendigo Alliance and other one -off costs. 4 Normalised profit before tax excludes the non-cash accounting impact of the Bendigo Alliance and other one -off costs. For personal use only
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RECONCILIATION OF STATUTORY TO NORMALISED RESULTS Normalisation adjustments $’000 unless stated otherwise H1 FY25 Statutory Bendigo Alliance gross profit share Investment in associate H1 FY25 Normalised Total revenue 248,310 248,310 Payments direct expense (130,958) (4,772) (135,730) Interest expense on deposits (598) (598) Total direct expenses (131,556) (4,772) (136,328) Gross profit 116,754 (4,772) 111,982 Employee benefits expense (excl. share-based payments) (50,701) (50,701) Licencing, hosting and communication costs (11,295) (11,295) Administrative and other expenses (8,099) (8,099) Marketing expenses (4,815) (4,815) Contractor and consulting expenses (2,359) (2,359) Operating expenses (77,269) (77,269) Lending and non-lending losses (1,717) (1,717) Total expenses (78,986) (78,986) EBITDA 37,768 (4,772) 32,996 Share-based payments (2,004) (2,004) Share of gains from associates 63 (63) - Depreciation and amortisation (22,382) 4,355 (18,027) Impairment of intangible assets (1,747) (1,747) EBIT 11,698 (417) (63) 11,218 Other interest expense (1,442) 772 (670) Net profit before tax 10,256 355 (63) 10,548 29 For personal use only
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FINANCIAL POSITION $’000 unless stated otherwise 31 December 2024 30 June 2024 Assets Cash and financial investments1 155,449 165,042 Loans to merchants 38,838 39,325 Property, plant and equipment 55,851 51,334 Intangible assets and goodwill 91,239 97,772 Right-of-use assets 21,830 23,630 Other current assets 48,364 49,764 Other non-current assets 24,654 24,591 Total assets 436,225 451,458 Liabilities Deposits 89,151 88,882 Commissions payable to Bendigo Bank 55,031 59,031 Other current liabilities 47,461 66,148 Non-current liabilities 27,805 29,723 Total liabilities 219,448 243,784 Equity Contributed equity 275,988 279,466 Accumulated losses and reserves (59,211) (71,792) Total equity 216,777 207,674 1 Cash and financial investments excluding equity investments. 30 For personal use only
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FREE CASH FLOW $’000 unless stated otherwise H1 FY25 H1 FY24 Change Operational cash flows EBITDA 32,996 27,348 5,648 Non-cash adjustments (1,257) 600 (1,857) Capital expenditure (17,353) (15,014) (2,339) Rent payments (2,292) (2,139) (153) Working capital movements (3,124) (428) (2,696) Free cash flows in the course of normal business 1 (before banking) 8,970 10,367 (1,397) 1 Free cash flow is calculated before changes in banking funds and timing differences relating to net scheme receivables. It is calculated as EBITDA before share based payments adjusted for non-cash items in Tyro’s working capital movements, statutory adjustments (including rent payments) and capital expenditure including internally generated intangibles. Terminal capital expenditure includes both new and replacement terminals. 31 For personal use only
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SUPPLEMENTARY INFORMATION: PAYMENTS Transaction Value (TTV) Merchant Count Performance by vertical H1 FY25 $’million H1 FY24 $’million Change % Proportion of H1 FY25 TTV H1 FY25 # H1 FY24 # Change % Hospitality 9,058 9,455 (4.2%) 41.2% 15,955 16,333 (2.3%) Retail 5,314 5,393 (1.5%) 24.2% 10,586 10,850 (2.4%) Health 3,648 3,139 16.2% 16.6% 25,277 18,716 35.1% Service/Other 1,733 1,704 1.7% 7.9% 9,206 8,917 3.2% Tyro core 19,753 19,691 0.3% 89.9% 61,024 54,816 11.3% Bendigo 2,218 2,483 (10.7%) 10.1% 12,535 13,964 (10.2%) Total 21,971 22,174 (0.9%) 100.0% 73,559 68,780 6.9% 32 For personal use only
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THANK YOU For personal use only